4Q2025 - International Growth Commentary
We believe our ongoing commitment to quality growth investing positions us well to navigate market volatility and capitalize on the earnings potential of our holdings.
- Foreign equity markets delivered their best returns in over a decade while our International Growth Composite Portfolio (the “Portfolio) finished the year essentially flat. This underperformance was not a result of deteriorating business fundamentals among our holdings, but rather a pronounced market preference for cyclically sensitive businesses.
- We seek to invest in businesses with durable competitive advantages, strong returns on capital, and resilient earnings. Investment styles cycle in and out of favor but we believe that over the long-term investors are best served by investing in quality businesses that grow without taking undue risks.
- Top relative contributors to the Portfolio’s performance included Tokyo Electron, Alibaba Group (not owned), and ASML. The largest relative detractors in the quarter were Monday.com, MercadoLibre, and SAP.
- During the quarter, we established a new position in Nintendo and added to several existing holdings to capture emerging opportunities and evolving company fundamentals.
- To fund these investments and optimize portfolio positioning, we eliminated positions in Teleperformance and Siemens Healthineers and trimmed selected exposures across the Portfolio.