PSN Top Guns 1 Stars 1Q 2020If you missed our recent press release, we are proud to have been awarded one of PSN’s Top Guns within the large cap growth manager universe for 1Q20. The Russell 1000 Growth Index fell -14.10% during the worst quarter for stocks since 1987. In comparison, our strategy was only down -5.22%, outperforming the Index by 8.88ppts.

PSN Large Cap Growth Universe
PSN Large Cap Growth Universe vs PeersSee disclaimer below for above charts.

What drove the strong relative performance during the first quarter?

In a word: Innovation

Evolutionary Tree is a specialist in innovation-focused, concentrated growth strategies. The firm believes that investing in leading innovators driving secular trends is the best way to add value for clients over the long term. In our experience, in times of crisis or recession, consumers and businesses often adopt certain innovations at a faster pace. Given the pandemic-driven stay-at-home and work-from-home dynamic, many secular trends and evolutionary shifts—such as the shift to e-commerce, video streaming, and cloud computing—have seen acceleration. The team at Evolutionary Tree believes that these behavioral changes will prove to be durable. 

Recessions often drive consumers and businesses to adopt innovations that offer cost reduction, convenience, or a better way of performing an activity. In short, tough times accelerate the future. Innovation-focused portfolios allow clients to benefit from these dynamics.

In addition to offering growth opportunities, innovation-focused strategies can, at times, be lower risk than other investment strategies, especially when leading innovators benefit from structural shifts. The 2020 pandemic and bear market demonstrates that innovation-focused strategies may offer both offense and defense. Innovation-focused portfolios, such as Evolutionary Tree’s Beagle US Innovators strategy, have held up exceptionally well in the current environment. Additionally, the firm believes owning leading innovators will also allow clients to be well positioned when the economy finally re-opens.           

If you are interested in reading our PSN Top Guns official press release, please click here.

 

[Watch Webinar] Innovation Investing: Navigating Accelerating Change in an Evolving Economy (recorded May 5, 2020)

 

Disclaimer:
Criteria: The PSN universes were created using the information collected through the PSN investment manager questionnaire and use only gross of fee returns. Mutual fund and commingled fund products are not included in the universe. PSN Top Guns investment managers must claim that they are GIPS compliant. Top ten performers for the latest three-month period become 1 STAR TOP GUNS.

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The PSN Large Cap Growth universe is comprised of 152 firms and 208 products

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The information and views expressed herein are provided for informational purposes only and do not constitute investment advice. Past performance does not guarantee future results. Any projections, outlooks, or estimates contained herein are forward looking statements based on specific assumptions that are current as of the date indicated, subject to change without notice, and should not be construed as indicative of any actual events that have occurred or may occur. The inclusion of particular investments is not intended to represent, and should not be interpreted to imply, a past or current specific recommendation to purchase or sell a security and should be considered in the context of an overall portfolio. Investing in equity securities involves risk and principal loss is possible. Nothing contained herein constitutes investment, legal, tax, or other advice and should not be relied upon in making an investment or other decision. Investors should always obtain and read up-to-date investment services material before deciding whether to appoint an investment advisor.