Our institutional approach to asset management affords invaluable insights to the granularities of how businesses deploy capital. This in turn informs our conclusions on issuers better poised for disproportionate value creation, which is the crux to alpha generation in our actively managed strategies. This exercise becomes even more imperative during times when macro clouds impair ground visibility. In today’s case, the global scramble for pandemic mitigation can obfuscate how troops on the ground are reassembling to capture massive demand shifts underway. Without careful study of these bottom-up efforts, critical components to our eventual economic recovery would be overlooked, leading to avoidance of upside participation for investors.
As part of our customary quarterly review process to the SWS Growth Equity strategy, which we benchmark against the Russell 1000 Growth Index, we delve into the fundamental justifications of our portfolio’s top contributors and detractors. The following two stocks are samples of the best and worst performers during 1Q2020, extracted from our strategy’s full quarterly review, available for download here.