ACGLO - Baron Asset Fund Q4 2023 Shareholder Letter
2024-01-25 08:20:00 ET
Summary
- Baron is an asset management firm focused on delivering growth equity investment solutions known for a long-term, fundamental, active approach to growth investing.
- Baron Asset Fund gained 12.45% in Q4, trailing the Russell Midcap Growth Index, which gained 14.55%.
- Several holdings in Consumer Discretionary, Industrials, and Financials were generally responsible for the relative shortfall during the quarter.
- TransUnion is a consumer credit bureau that helps businesses make lending and marketing decisions.
Performance
Moderating inflation and softening labor market conditions contributed to both falling interest rates and investors’ growing belief that a hard landing economic recession will be avoided. This optimistic scenario propelled a risk on investor mindset and a strong equity market rally during the quarter. Most sectors closed higher, led by Information Technology ((IT)), which benefited from widespread gains in fast-growing software and semiconductor companies. Other leading sectors included Real Estate and Financials, which generally benefited from declining rates, as well as Industrials and Consumer Discretionary, which were bolstered by moderating recessionary fears. Defensive sectors, including Consumer Staples, Health Care, and Utilities, underperformed amid this market environment. The Energy sector declined, as oil prices fell throughout the period.
Against this backdrop, Baron Asset Fund® (the Fund) gained 12.45% (Institutional Shares) in the fourth quarter, trailing the Russell Midcap Growth Index (the Index), which gained 14.55%. The Fund’s relative underperformance was driven partly by headwinds from its style biases, notably its underexposure to stocks with elevated beta and residual volatility, as well as the impact of stock selection....
Baron Asset Fund Q4 2023 Shareholder Letter