U.S. Large Cap Growth Equity Concentrated
- Employs a thematic approach to identify secular winners with large addressable markets
- Combines investment themes with bottom-up, fundamental analysis of stocks looking for businesses that can compound revenues and cash flows across a cycle at a multiple of GDP
- Focuses on businesses that we believe have a strong ownership culture, and exhibit both a high level of growth and an above average duration of growth
Benchmark indexRussell 1000 Growth Index
AUM ($M) Strategy †13,695
AUM ($M) Composite †68.9
Typical range of portfolio holdings25–40
Related Putnam mutual fundGrowth Opportunities Fund
*No assurance can be given that the investment objective will be achieved or that an investor will receive a return of all or part of his or her investment. Actual results could be materially different from the stated goals. Investors should carefully consider the risk involved before deciding to invest. As with any investment, there is a potential for profit as well as the possibility of loss. Portfolio targets are subject to change.
†Strategy assets include assets for aggregate strategy accounts that are not reflected in the composite. Strategy inception represents the aggregate strategy inception date.
A commitment to deep fundamental research
The team analyzes global trends, as well as problems and potential solutions, to identify which themes could drive sustained growth for businesses over a multi-year time horizon. Learn more about the theme-based strategy and the experiences that shaped the managers' investing approach.
Performance and holdings as of 12/31/20
Composite performance (%)
Past performance is not a guarantee of future results. An investment in this strategy can lose value. Returns are stated in U.S. dollars and include the reinvestment of dividends and interest. Returns less than one year are not annualized. Most recent quarter-end performance is preliminary. Returns are subject to change. Portfolio characteristics are for a representative account and are shown for illustrative purposes only. Portfolio characteristics of individual accounts managed to a model portfolio strategy may differ as a result of account size, client-imposed investment restrictions, the timing of client investments, market, economic and individual company considerations, and other factors. The inclusion of holdings information should not be interpreted as a recommendation to buy or sell or hold any security. The securities identified do not represent all the securities purchased, sold, or recommended for client accounts. It should not be assumed that an investment in the securities identified was or will be profitable. Holdings are subject to change.
Top 10 portfolio holdings (%)
|Apple||10.2||Technology hardware, storage and peripherals|
|Amazon||7.9||Internet and direct marketing retail|
|Alphabet||5.6||Interactive media and services|
|UnitedHealth||3.5||Health care providers and services|
|Nike||3.2||Textiles, apparel and luxury goods|
Performance commentary as of 12/31/20
The strategy posted high single absolute returns but underperformed its benchmark. As always, we are focused on high-quality companies and strong cash flows, but these characteristics did not translate into excess returns against the benchmark in the fourth quarter. For 2020, the strategy performed in line with the Russell 1000 Growth.
Selections within information technology, consumer discretionary and healthcare sectors detracted most from performance. Adept positions within consumer staples proved beneficial. Top contributors included Apple, Tesla, Alphabet, PayPal and Idexx. Top detractors were DexCom, Vertex Pharmaceuticals, S&P Global, Everbridge and DraftKings.
Over the past nine months or so, we have seen shifts in the economy and trends that we believe offer long-term, durable growth opportunities. These include broad themes such as increased digitization, a growing number of businesses with direct sales channels, and more capital-light business models. Huge industries such as health care and parts of the industrial and consumer complex are ripe for technological change. We seek to own businesses that are enabling and benefiting from this change.
We believe the growth profiles for many of the companies held in the strategy are supported by long-tailed themes and we explicitly take prior cycle downside capture into account within our risk framework. Our desire to own high quality businesses with a narrow range of outcomes has benefited relative returns. This framework has served the strategy well in the past and we would expect it to continue to do so into the future.
Performance commentary is not intended to be relied upon as a forecast or as research, or investment advice, and is not a recommendation, offer, or solicitation to buy or sell any securities or to adopt any investment strategy. It should not be assumed that an investment in any security mentioned was or will be profitable. As with any investment, there is a potential for profit as well as the possibility of loss. Past performance is no guarantee of future results.
The strategy was formerly named the U.S. Large Cap Growth Equity Separately Managed Account.
The Russell 1000 Growth Index is an unmanaged index of those companies in the large-cap Russell 1000 Index chosen for their growth orientation. Frank Russell Company is the source and owner of the trademarks, service marks, and copyrights related to the Russell Indexes. Russell® is a trademark of Frank Russell Company. You cannot invest directly in an index.
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