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Quarter	Letter Date	Fund Name	QTD	YTD	Tickers	Themes	Quick Take

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Harding Loevner Global Equity 2024 Q3 Investor Letter | Buyside Digest

Back to Fund Profile (Harding Loevner Global Equity)

Primary Source Intelligence • Q3 2024 Letter Analysis

Harding Loevner Global Equity Quarterly Analysis

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

Fund Returns

Annualized+9.44%

Digest Analysis

Quick Take

"Harding Loevner underperformed in Q3 as momentum-driven markets favored large index stocks they don't own. The team deliberately avoids momentum investing despite recent challenges, focusing on fundamental analysis and quality growth companies."

Executive Summary

Harding Loevner's Global Equity strategy returned 5.19% net in Q3 2024, trailing the MSCI ACWI Index's 6.72% gain. The portfolio was challenged by momentum concentrated in large market leaders, particularly affecting Communication Services holdings like Pinterest and Alphabet. The manager deliberately resists momentum investing due to trading costs, volatility risks, and FOMO-driven poor decisions. Key contributors included not owning NVIDIA and strong performance from Chugai Pharmaceutical and Adyen. The team reduced semiconductor exposure earlier in the year, benefiting from sector underperformance, while adding to medtech companies like Repligen during weakness. China's stimulus package drove late-quarter gains in Asian holdings. Portfolio changes included selling ASML and L'Oréal due to valuation concerns while adding Applied Materials for its advanced-packaging technology exposure. The strategy maintains underweight US positioning and focuses on quality growth companies, preparing to capitalize on potential election-driven volatility to add attractive names at reasonable valuations.

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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%)

The manager demonstrates high conviction through concentrated positions in named holdings, specific position sizing decisions (increasing Repligen stake), and clear investment philosophy around avoiding momentum. They provide detailed fundamental analysis for individual holdings and maintain disciplined risk limits despite performance pressure.

Growth Outlook

25%

BearishBullish

Bearish (25%)

The manager expresses cautious optimism about medtech growth trends being back on track and sees opportunities in quality growth companies at reasonable prices. However, they acknowledge challenges from momentum markets and political uncertainty, resulting in a mildly positive but measured outlook.

Risk Appetite

10%

DefensiveAggressive

Defensive (10%)

The portfolio is positioned defensively with reduced exposure to expensive holdings, particularly in the US, and is now underweight the US relative to the index. The manager is prepared to deploy capital but is currently maintaining a cautious stance with selective positioning.

Capital Deployment

15%

De-riskingDeploying

De-risking (15%)

The manager has been selectively adding to positions like Repligen and other medtech names during weakness over the past 18 months, but also reduced expensive holdings and sold positions like ASML and L'Oréal. This represents modest net deployment with active rotation rather than aggressive capital deployment.

Forward Guidance

30%

CautiousExpansionary

Cautious (30%)

The manager indicates readiness to take advantage of opportunities to increase weightings of US quality growth companies at more reasonable prices, particularly if election volatility creates dislocations. This suggests a selective deployment bias but with patience for the right conditions.

Language Signal

15%

BearishBullish

Bearish (15%)

Language is balanced between opportunity recognition (medtech growth back on track, attractive valuations in some areas) and risk awareness (momentum challenges, political uncertainty, semiconductor downturn risks). Slightly more constructive than bearish overall.

Perceived Risk

65%

Low RiskElevated

Elevated Risk (65%)

The manager identifies multiple specific risks including momentum reversals, FOMO-driven poor decisions, political uncertainty from US elections, and potential semiconductor industry downturn. They discuss these risks in detail with concrete examples and implications, indicating moderate to high risk perception.

Opportunity Density

55%

ScarceAbundant

Selective (55%)

The manager sees selective opportunities in medtech companies, quality growth names at reasonable prices, and potential opportunities from election volatility. However, they also note challenges in finding attractive valuations and have been reducing expensive holdings, suggesting a moderately selective environment.

Time Horizon

75%

Short-TermLong-Term

Decade+ (75%)

The manager emphasizes long-term fundamental analysis over momentum, mentions holding L'Oréal for 22 years, and discusses multi-year trends in semiconductor technology shifts. They focus on sustainable competitive advantages and long-term growth trends rather than near-term catalysts, indicating a long-term investment horizon.