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| Quarter | Letter Date | Fund Name | QTD | YTD | Tickers | Themes | Quick Take |
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"NCG strategies broadly beat their benchmarks in Q2, with the team particularly excited about the historic valuation discount in small cap growth stocks relative to large caps."
Next Century Growth Investors (NCG) reported that most of its strategies outperformed their respective benchmarks in 2Q25, led by strong performance in SMID Cap, Large Cap, and Small Cap. Equity markets rallied back from an early-April tariff-induced selloff following a 90-day implementation pause. Within the SMID Cap portfolio, NCG added 7 new holdings (such as TransMedics, ARS Pharmaceuticals, and Agilysys) and fully exited 4 positions (including Hexcel and AAON). The manager remains highly optimistic about small cap growth stocks due to a historic valuation disconnect relative to large caps, where small caps currently trade in the 5th percentile relative to history.
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Algorithmic conviction, macroeconomic posture, and risk appetite signals extracted from this quarterly letter with qualitative explanations.
Market Conviction
High-conviction positioning: NCG strategies broadly beat their benchmarks in Q2, with the team particularly excited about the historic valuation discount in small cap growth stocks relative to large caps....
Growth Outlook
Market outlook remains above average conviction: NCG strategies broadly beat their benchmarks in Q2, with the team particularly excited about the historic valuation discount in small cap growth stocks relative to large caps....
Risk Appetite
Risk appetite posture is above average conviction: NCG strategies broadly beat their benchmarks in Q2, with the team particularly excited about the historic valuation discount in small cap growth stocks relative to large caps....
Capital Deployment
Manager actively deployed capital into high-conviction opportunities. NCG strategies broadly beat their benchmarks in Q2, with the team particularly excited about the historic valuation discount in small cap growth stocks relative to large caps....
Forward Guidance
Forward guidance signal: NCG strategies broadly beat their benchmarks in Q2, with the team particularly excited about the historic valuation discount in small cap growth stocks relative to large caps....
Language Signal
Tone analysis indicates above average conviction language: NCG strategies broadly beat their benchmarks in Q2, with the team particularly excited about the historic valuation discount in small cap growth stocks relative to large caps....
Perceived Risk
Perceived risk level is evaluated as moderate conviction. NCG strategies broadly beat their benchmarks in Q2, with the team particularly excited about the historic valuation discount in small cap growth stocks relative to large caps....
Opportunity Density
Opportunity density index indicates high conviction actionable entry points. NCG strategies broadly beat their benchmarks in Q2, with the team particularly excited about the historic valuation discount in small cap growth stocks relative to large caps....
Time Horizon
Investment time horizon reflects a high conviction orientation. NCG strategies broadly beat their benchmarks in Q2, with the team particularly excited about the historic valuation discount in small cap growth stocks relative to large caps....
