1Q2021 – Global Growth Commentary

We greatly prefer to own the businesses that are disrupting rather than those being disrupted.

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  • During the first quarter of 2021, the Polen Global Growth Composite Portfolio (the “Portfolio”) returned 1.39% gross of fees. The MSCI All-Country World Index (the “Index”) returned 4.58% during the same period. Thus, the Portfolio trailed the Index on a relative basis by 3.19%.
  • Since its inception on January 1, 2015, the Portfolio has delivered an annualized return of 16.71% gross of fees compared to a 10.07% annualized return for the Index.
  • The market favored more cyclical and earnings-depressed businesses and businesses with higher levels of debt and lower levels of profitability during the last three months. This contrasts with the types of businesses we seek to own.
  • The Portfolio’s leading contributors were a result of strong underlying business performance, while the leading detractors during the quarter were indicative of the market rotation.
  • Turnover was modest during the quarter. We purchased Amazon, added to Alibaba, and trimmed ADP, PayPal, and Align Technology.
  • Looking at the last six months, we have seen a rather notable rotation to “value” stocks. We, however, see strong and disruptive secular forces at play today, and we feel confident that our concentrated high-quality growth portfolio remains well-positioned for the coming years.

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