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Quarter	Letter Date	Fund Name	QTD	YTD	Tickers	Themes	Quick Take

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Harding Loevner International Equity 2025 Q1 Investor Letter | Buyside Digest

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Primary Source Intelligence • Q1 2025 Letter Analysis

Harding Loevner International Equity Quarterly Analysis

Buyside Digest is not affiliated with, and does not endorse, Harding Loevner International Equity. This analysis is provided for institutional research purposes only and is not investment advice.

Fund Returns

QTD+5.08%

YTD+5.08%

Annualized+7.3%

Positioning StanceConstructive

GeographyGlobal

Digest Analysis

Quick Take

"International equity strategy navigates US policy uncertainty by focusing on resilient companies outside America's volatile policy environment. Added semiconductor equipment maker ASML after sharp decline, seeing opportunity in more realistic growth expectations."

Executive Summary

Harding Loevner's International Equity strategy returned 5.08% net in Q1 2025, nearly matching the MSCI ACWI ex US Index gain of 5.36%. The quarter was dominated by heightened US policy uncertainty, with tariffs expanding beyond China to include allies like Canada, Mexico, and Europe. This policy volatility undermines business confidence and investment appetite as rules become increasingly arbitrary. The manager views this environment through the lens of emerging markets experience, focusing on resilient companies that can operate effectively despite government volatility. In semiconductors, the team added ASML after its 30% decline, seeing opportunity as the sector now discounts more achievable growth expectations following AI-related concerns and the DeepSeek announcement. The portfolio benefits from international diversification, with about one-fifth of revenue from the US. The manager expects continued volatility but sees ample opportunities in the international market, where companies trade at more modest valuations than their US counterparts after years of US market outperformance.

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Institutional Meta Strategy

Meta Strategy Gauges

Algorithmic conviction, macroeconomic posture, and risk appetite signals extracted from this quarterly letter with qualitative explanations.

Signal Matrix

Market Conviction

68%

CautiousHigh

Moderate (68%)

Manager demonstrates moderate-high conviction through specific position sizing discussions, detailed investment rationale for ASML purchase, and clear portfolio construction philosophy. Names multiple holdings with specific weightings and provides detailed thesis for semiconductor investments.

Growth Outlook

38%

BearishBullish

Neutral (38%)

The manager expresses caution about US policy volatility and its negative effects on business confidence, but sees opportunities in international markets. Mixed view with concerns about disruption balanced by optimism about non-US opportunities.

Risk Appetite

15%

DefensiveAggressive

Defensive (15%)

Portfolio remains fully invested with selective additions like ASML, showing measured risk appetite. The manager is positioned defensively through international diversification but continues to deploy capital selectively.

Capital Deployment

20%

De-riskingDeploying

De-risking (20%)

Net neutral deployment with one new position (ASML) added while two positions (Wuliangye Yibin, Ambev) were sold. Portfolio remains fully invested at 96.4% with selective rotation rather than major cash changes.

Forward Guidance

10%

CautiousExpansionary

Cautious (10%)

Manager expects continued volatility but plans to pursue opportunities in resilient companies. Cautiously optimistic about finding attractive investments despite challenging environment.

Language Signal

45%

BearishBullish

Balanced (45%)

Language includes significant risk-focused terms like 'chaos,' 'daunting,' 'disruption,' and 'self-destructive policies,' but balanced with opportunity language like 'ample opportunity set' and 'attractive valuations.'

Perceived Risk

72%

Low RiskElevated

Elevated Risk (72%)

Manager identifies multiple specific macro risks including policy uncertainty, trade war fallout, business confidence erosion, and potential disruption of global economic order. Detailed discussion of systemic risks from US policy volatility.

Opportunity Density

65%

ScarceAbundant

Abundant (65%)

Manager sees 'ample opportunity set' in international markets and notes that companies trade at 'more modest prices than in many years.' Selective opportunities identified, particularly in semiconductors after sector decline.

Time Horizon

70%

Short-TermLong-Term

Decade+ (70%)

Manager discusses multi-year themes and anticipates ASML can sustain mid-teens growth 'over the next five years.' Focus on companies with enduring competitive advantages suggests medium to long-term investment horizon.