3Q2019 – U.S. Small Company Growth Commentary

  • During the third quarter of 2019, the Polen U.S. Small Company Growth Composite Portfolio (the ”Portfolio”) returned -3.49% gross of fees. This compared to a return of -4.17% for the Russell 2000 Growth Index (the “Index”) in the same period.
  • For the trailing 12-month period, the Portfolio returned -0.46% gross of fees compared to -9.62% for the Index.
  • The third quarter ended with a major reversal as investors rotated towards lower quality companies that are less profitable, more cyclical, and have higher financial leverage, areas we intentionally avoid.
  • Our Portfolio companies continued to perform well in the third quarter, exhibiting above-average growth rates, high returns on invested capital, and low levels of financial leverage.

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