The information contained on this site is intended for institutional investors only, and is published strictly for informational purposes only without regard to the investment objective, financial situation or specific needs of any particular investor. The information is not intended for use by institutional investors in a jurisdiction where distribution or purchase is not authorized.
An institutional investor is one that falls within one or more of the following categories:
If you do not fall within at least one of the above categories you should not access the information contained in the site.
Baron Capital Management, Inc. makes reasonable efforts to ensure the material on the site is as accurate and timely as possible and that disruptions of service are minimal, Baron Capital Management, Inc. makes no warranty or guarantee concerning the availability of this site or the services or the accuracy of the information on it. In addition, the information contained on the site is in no way intended to constitute investment advice, an offer to sell, or a recommendation of any security or investment product. In fact, the products described herein may not be available to, or suitable for, all investors. You should consider, if appropriate, obtaining independent professional advice before making an investment decision. Please consider the charges, risks, expenses and investment objectives carefully before investing. Nothing on this site is intended to constitute legal or tax advice.
Please keep in mind that the opinions and views expressed through the content and commentaries published on the site are just that - opinions and views - and that they are published on the site for informational purposes only. In addition, views and opinions are based on the information available at the time and may not necessarily be shared by Baron Capital Management, Inc., or its employees, in general. As the investing environment changes, so could this information, and Baron Capital Management, Inc. has no responsibility to update it.
Past performance is not a guarantee of future performance. Investment results and principal value will fluctuate so shares, when redeemed, may be worth more or less than their original cost. Investors should be aware of the additional risks associated with investments in non-diversification, undervalued or overlooked companies and investments in specific industries. Additional risks may include those associated with investing in foreign securities, emerging markets, and companies with relatively small market capitalizations.
By selecting “I Agree” below, you confirm that you are an institutional investor or consultant to an institutional investor.
The link you have selected is not available within the Institution user experience. You will be switched to view this website as a Financial Advisor.
When you wish to view strategies again, click an 'Institution' link within the 'View As' menu or 'Strategies' in the footer.
Thank you for your email. We will respond as soon as possible.
as of 06/30/21
Domestic investors spent the second quarter debating whether the ongoing economic rebound will lead to elevated inflation. As usual, short-term macroeconomic data was opaque, volatile, and inconclusive, enabling central bankers and investors to pick and choose the data that supported their favored conclusion. Visibility has been further confounded by a dispute over the impact of generous federal unemployment benefits on tight labor markets. Interest rates, as measured by the yield on the 10-year U.S. Treasury bond, fluctuated as investors struggled to divine the future trajectory of prices and how the U.S. Federal Reserve will accordingly set monetary policy. Despite the uncertainty, the markets were largely positive, rising to record highs during the quarter as a significant decline in COVID-19 cases combined with a near-total economic reopening across the country led a surge in economic growth.
Against this backdrop, Baron Growth Fund increased in the quarter. Holdings within Financials, Health Care, and Information Technology (IT) contributed the most. Consumer Discretionary and Communication Services investments detracted. Top contributor MSCI, Inc. drove much of the appreciation within Financials. Positive performance within Health Care was led by second largest contributor IDEXX Laboratories, Inc. IT benefited from share price gains in third largest contributor Gartner, Inc. Consumer Discretionary had a challenging quarter, with all three top detractors within the sector. Both Communication Services holdings lost ground, including Iridium Communications Inc. Shares of this leading satellite communication services vendor were pressured by pandemic-related restrictions that negatively impacted growth initiatives and expectations for 2021. As COVID-19 restrictions are lifted, we anticipate growth from programs such as Certus Maritime to accelerate.
While as investors we have always taken a long-term perspective, as people, we are as pleased as anyone that near-term prospects for our country seem quite encouraging as the vaccination program – unprecedented for its breadth and speed – appears to have been successful in helping put the worst of the pandemic in the rear-view mirror. We are feeling optimistic that continued government support for the economy combined with economic conditions that are moving back to normalcy bode well for the market going forward.
as of 06/30/21
as of 06/30/21
When reviewing performance attribution on our portfolio, please be aware that we construct the portfolio from the bottom up, one stock at a time. Each stock is included in the portfolio if it meets our rigorous investment criteria. To help manage risk, we are aware of our sector and security weights, but we do not include a holding to achieve a target sector allocation or to approximate an index. Our exposure to any given sector is purely a result of our stock selection process.
as of 06/30/21
Baron Growth Fund (Institutional Shares) was up 7.80% in the second quarter, outperforming the Russell 2000 Growth Index by 388 basis points due to stock selection and, to a lesser extent, differences in sector/sub-industry exposures.
Investments in Financials, Health Care, Industrials, and Information Technology (IT) contributed the most to relative performance. Within Financials, outperformance of the Fund’s largest holding, investment decision support tools provider MSCI, Inc., and significantly higher exposure to this strong performing sector added the most value. MSCI was the top contributor due to solid first quarter earnings results and positive reports from management on the overall operating environment. Specialist asset manager Cohen & Steers, Inc., investment data company Morningstar, Inc., and investment management tools provider FactSet Research Systems, Inc. also performed well in the sector. Favorable stock selection in Health Care accounted for most of the outperformance in the period as several of the Fund’s holdings posted double-digit gains as a result of robust business momentum. Veterinary diagnostics leader IDEXX Laboratories, Inc., life sciences tools developer Bio-Techne Corporation, and pharmaceutical packaging manufacturer West Pharmaceutical Services, Inc. led the way in the sector. Meaningfully lower exposure to underperforming biotechnology stocks contributed an additional 53 basis points to relative results. Within Industrials, outperformance of composite residential decking manufacturer Trex Company, Inc. and lower exposure to this lagging sector bolstered relative results. Trex reported strong financial results and released second quarter sales guidance well ahead of Street expectations as composite decking continues to take share from wood. Additional manufacturing capacity also came online during the quarter, easing capacity constraints and increasing sales. Strength in IT was driven by Gartner, Inc., the world's leading research and advisory company. Gartner was the third largest contributor after the company’s financial results topped analyst forecasts. Growth in the company’s research business has reaccelerated and is poised to return to double-digit levels, while its events business should add to financial results as travel restrictions ease.
Underperformance of Consumer Discretionary and Communication Services investments detracted the most from relative results. Weakness in Consumer Discretionary was largely due to share price declines from regional casino operator Penn National Gaming, Inc., corporate daycare provider Bright Horizons Family Solutions, Inc., and timeshare company Marriott Vacations Worldwide Corp., which were the top three detractors on an absolute basis. Satellite company Iridium Communications Inc. weighed the most on performance in Communication Services as lingering COVID-19 restrictions negatively impacted short-term growth initiatives.
Investors should consider the investment objectives, risks, and charges and expenses of the investment carefully before investing. The prospectus and summary prospectuses contain this and other information about the Funds. You may obtain them from the Funds’ distributor, Baron Capital, Inc., by calling 1-800-99BARON or visiting www.BaronFunds.com. Please read them carefully before investing.
The performance data quoted represents past performance. Past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate; an investor's shares, when redeemed, may be worth more or less than their original cost. The Fund’s transfer agency expenses may be reduced by expense offsets from an unaffiliated transfer agent, without which performance would have been lower. Current performance may be lower or higher than the performance data quoted.
Risks:All investments are subject to risk and may lose value.
The discussion of market trends is not intended as advice to any person regarding the advisability of investing in any particular security. The views expressed on this page reflect those of the respective writer. Some of our comments are based on management expectations and are considered “forward-looking statements.” Actual future results, however, may prove to be different from our expectations. Our views are a reflection of our best judgment at the time and are subject to change at any time based on market and other conditions and Baron has no obligation to update them
Portfolio holdings are subject to change. Current and future portfolio holdings are subject to risk.
The index performance is not fund performance; one cannot invest directly into an index.