1Q2025 - Global SMID Company Growth Commentary
The Global SMID asset class faced a turbulent first quarter, with U.S. small caps declining sharply amid macroeconomic and geopolitical headwinds. In contrast, international small caps showed resilience, leading to notable performance divergence across regions.
- The Polen Capital Global SMID Company Growth Composite Portfolio underperformed in the quarter as our quality growth investment style lagged the core benchmark, the MSCI ACWI SMID Cap Index.
- Security selection was most effective in Consumer Discretionary and Information Technology, but was offset by weaker results in Industrials and Consumer Staples.
- The most significant contributors this quarter, both relative and absolute, were Sanrio, Goosehead Insurance, and Lottomatica. The most significant relative and absolute performers were Globant, e.l.f. Beauty, and Kalyan Jewellers.
- During the quarter, we initiated new positions in Lottomatica and Saia, and exited positions in Axis Bank, Booz Allen Hamilton, and Tetra Tech.
- We made adjustments across existing holdings, trimming some positions to fund new investments and adding to companies where we believe the market is underestimating business quality.
- While global economic crosswinds are shifting rapidly and geopolitical uncertainty creates a challenging environment for companies and investors, we remain focused on resilient.