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Quarter	Letter Date	Fund Name	QTD	YTD	Tickers	Themes	Quick Take

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Hardman Johnston International Equity 2025 Q1 Investor Letter | Buyside Digest

Back to Fund Profile (Hardman Johnston International Equity)

Primary Source Intelligence • Q1 2025 Letter Analysis

Hardman Johnston International Equity Quarterly Analysis

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

Fund Returns

QTD+0.07%

Annualized+9.76%

Positioning StanceConstructive

Market CapLarge Cap

GeographyEurope, Asia, Emerging markets

Digest Analysis

Quick Take

"Strong Q1 performance driven by defense contractors amid geopolitical tensions and increased spending commitments. Technology holdings pressured by AI sentiment shift but creating attractive entry points."

Executive Summary

Hardman Johnston's International Equity strategy delivered solid relative performance in Q1 2025, returning 6.92% net versus 6.86% for MSCI EAFE, despite turbulent market conditions driven by aggressive US trade policies. The portfolio benefited from strong performance in defense contractors Rheinmetall and Mitsubishi Heavy Industries as geopolitical tensions drove increased defense spending commitments across Europe and Japan. Technology holdings faced pressure from AI infrastructure sentiment deterioration following DeepSeek's launch, though the manager views semiconductor weakness as creating attractive entry points. The Trump administration's sweeping tariffs announced April 2nd create unprecedented trade uncertainty, but the manager maintains focus on quality companies with strong fundamentals and long-term growth characteristics. Key secular themes remain intact including aging demographics driving healthcare demand, defense spending increases, and AI-driven productivity gains. The strategy initiated Infineon Technologies at an attractive cycle point while reducing healthcare exposure due to government cost pressures. Despite near-term volatility, international diversification benefits are becoming more apparent as market dislocations present selective opportunities.

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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

72%

CautiousHigh

High Conviction (72%)

Portfolio holds 24 concentrated positions with detailed thesis explanations for each holding. Manager demonstrates strong conviction through position sizing language ('scale up our position sizing' for Rheinmetall) and specific catalyst identification. Clear rationale provided for both initiations and liquidations with explicit fundamental analysis.

Growth Outlook

38%

BearishBullish

Neutral (38%)

Manager acknowledges substantial uncertainty and volatility from trade policies but sees opportunities emerging. Describes environment as having 'substantially more dust' than expected with 'unprecedented trade turbulence' yet maintains constructive view on secular themes and selective opportunities.

Risk Appetite

10%

DefensiveAggressive

Defensive (10%)

Portfolio maintained concentrated positions in quality names while making selective adjustments. Initiated new position in Infineon and liquidated two holdings, suggesting measured risk appetite. Cash position at 3.7% indicates neither aggressive deployment nor defensive positioning.

Capital Deployment

5%

De-riskingDeploying

De-risking (5%)

Limited net deployment activity with one initiation (Infineon) and two liquidations (Grifols, TechnipFMC). Cash position at 3.7% suggests neutral positioning. Activity appears to be rotation rather than significant net deployment or de-risking.

Forward Guidance

25%

CautiousExpansionary

Cautious (25%)

Manager expects volatility to create additional attractive entry points and is evaluating market dislocations for opportunities. Language suggests selective deployment bias with focus on long-term growth prospects rather than defensive positioning.

Language Signal

0%

BearishBullish

Bearish (0%)

Balanced mix of risk language (turbulent, uncertainty, headwinds, vulnerable) and opportunity language (attractive, solid performance, compelling, growth potential). Risk discussions are substantial but counterbalanced by opportunity identification and secular theme confidence.

Perceived Risk

75%

Low RiskElevated

Elevated Risk (75%)

Manager identifies multiple significant risks including trade war impacts, slowing global growth, interest rate headwinds, and sector-specific pressures. Describes environment as having 'unprecedented trade turbulence' and 'substantial uncertainty' with detailed discussion of macro headwinds and policy risks.

Opportunity Density

65%

ScarceAbundant

Abundant (65%)

Manager sees selective opportunities within volatile environment, particularly in defense, European financials, and semiconductor cycle positioning. Describes 'attractive growth opportunities' and expects 'volatility to open up additional attractive entry points' while emphasizing need for selectivity.

Time Horizon

70%

Short-TermLong-Term

Decade+ (70%)

Focus on 'long-term growth characteristics' and 'secular themes' suggests multi-year investment horizon. Manager discusses structural trends like aging demographics and defense spending increases that play out over years rather than quarters, indicating patient capital approach.