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Quarter	Letter Date	Fund Name	QTD	YTD	Tickers	Themes	Quick Take

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SGA - Global Growth 2026 Q2 Investor Letter | Buyside Digest

Back to Fund Profile (SGA - Global Growth)

Primary Source Intelligence • Q2 2026 Letter Analysis

SGA - Global Growth Quarterly Analysis

Buyside Digest is not affiliated with, and does not endorse, SGA - Global Growth. This analysis is provided for institutional research purposes only and is not investment advice.

Fund Returns

QTD+7.2%

YTD-7.6%

Annualized+9.7%

Positioning StanceNEUTRAL

Market CapLarge Cap

GeographyAsia, Emerging markets, Europe, Global, US

Digest Analysis

Quick Take

"Portfolio now trades at steepest discount to market since 2011 inception despite positioning for 16% revenue and 20% earnings growth from predictable businesses. Manager sees compelling opportunity as AI hype matures and memory cycle reminds investors cyclicality persists."

Executive Summary

SGA's Global Growth Portfolio returned 7.2% net in Q2 2026 versus 14.9% for MSCI ACWI, underperforming due to extreme momentum leadership favoring AI infrastructure beneficiaries. The MSCI ACWI Momentum Index rose 46% marking historic high after three years of leadership, a nearly three standard deviation event wider than 1999 or 2007. Despite underperformance, portfolio companies delivered median revenue growth of 12% and EPS growth of 14% with 60%+ beating consensus expectations. Manager's direct AI holdings including TSMC, Arm, Nvidia, Alphabet, Amazon, and Broadcom contributed over 100% of portfolio returns while rest of portfolio detracted as quality growth went unrewarded. Portfolio now trades at steepest discount to MSCI ACWI since 2011 inception with Enterprise Yield of approximately 3%, positioning for 16% revenue growth and 20% earnings growth over next three years from predictable businesses. Manager initiated six new positions including Linde, Equinix, Schneider Electric, and Arista Networks while exiting Universal Music Group, Alcon, and Intuit. With memory cycle showing speculation signs, IPO calendar testing appetite, and AI implementation taking longer than expected, manager believes conditions building for rotation toward quality compounders offering compelling risk-adjusted return potential.

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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 concentrated portfolio of 30-40 named positions with clear thesis per holding and specific position sizing language ('above-average weight,' 'below-average weight,' 'average weight'). Letter includes detailed fundamental analysis of each new position with specific growth expectations and competitive advantages. Manager states 'we have high conviction in our positioning' explicitly. However, conviction capped below 0.75 because portfolio is diversified across 30+ holdings rather than concentrated in 5-15 names, and manager acknowledges uncertainty around timing with language like 'we will continue to monitor' for multiple positions. Hedging language present in risk discussions for each new position. Portfolio behavior shows conviction through maintaining positions during underperformance and adding six new names, but diversification and hedging prevent higher score.

Growth Outlook

33%

BearishBullish

Bearish (33%)

Manager expresses caution about current market conditions, noting momentum leadership has reached nearly three standard deviation event wider than 1999 or 2007. Describes speculative activity reaching fever pitch with DRAM ETF becoming fastest-growing in history and leveraged plays indicating behavioral warning signs. References IPO calendar having 'unmistakable feel of bell being rung' historically marking cycle tops. However, manager also notes global market trading at more reasonable valuation than 1999-2000 and sees ample opportunity in quality growth businesses, preventing more deeply negative score.

Risk Appetite

45%

DefensiveAggressive

Balanced (45%)

Manager maintains above-average weight positions in dominant AI enablers TSMC, Alphabet, and Nvidia while actively initiating six new positions including Linde, Equinix, Schneider Electric, and Arista Networks. Portfolio remains fully invested with no indication of raising cash or defensive positioning. However, manager trimmed several positions on strength (Arm, Amazon, Nvidia, Fast Retailing) and has zero exposure to memory companies despite 3.2% benchmark weight, showing selective risk management. Positioning reflects constructive but selective approach rather than maximum risk-on.

Capital Deployment

35%

De-riskingDeploying

Net Neutral (35%)

Manager initiated six new positions (Linde, Equinix, Schneider Electric, Arista Networks, Galderma, Disco) and added to Netflix and Waste Management on weakness, indicating moderate deployment activity. However, letter explicitly states new positions are 'smaller, deliberately sized positions that we intend to build over time' suggesting gradual rather than aggressive deployment. Manager also exited three positions (Universal Music Group, Alcon, Intuit) and trimmed five positions (Amazon, Arm, Fast Retailing, Nvidia, CPKC, Alibaba), indicating significant rotation activity. Total portfolio turnover was approximately 12% for quarter and 44% over trailing twelve months, described as 'in line with historical averages.' No cash level data provided. Net activity reflects moderate deployment through new initiations balanced by trimming and exits, consistent with rotation rather than aggressive capital deployment.

Forward Guidance

25%

CautiousExpansionary

Cautious (25%)

Manager states intention to continue building newly initiated positions over time and describes them as 'deliberately sized positions' suggesting gradual deployment. Uses language like 'we plan to continue building the position opportunistically' for Schneider Electric. However, manager also emphasizes patience and monitoring, stating 'we will continue to monitor' for multiple holdings. No explicit language about aggressive near-term deployment or urgency to add capital. Forward stance is watchful and selective rather than aggressively deploying or pulling back.

Language Signal

30%

BearishBullish

Bearish (30%)

Language contains mix of directional signals. Bullish language includes 'excited about the opportunity present today,' 'compelling,' 'attractive,' 'well-positioned,' 'high conviction,' and repeated references to 'quality' and 'durable growth.' Bearish language includes 'cautious,' 'skeptical,' 'vulnerable,' 'disappointing,' 'toxic combination,' 'dangerous to extrapolate,' and warnings about 'speculation' and 'behavioral indicators.' Manager describes current environment as creating 'unusually attractive opportunity' but also notes 'extended underperformance' and 'frustration.' Net balance leans mildly positive given emphasis on opportunity and conviction in positioning, but substantial risk language prevents higher score.

Perceived Risk

72%

Low RiskElevated

Elevated Risk (72%)

Manager identifies multiple specific systemic risks with detailed discussion. Describes momentum leadership as 'nearly three standard deviation event' wider than 1999 or 2007. Warns of 'speculative activity reaching fever pitch' with DRAM ETF becoming fastest-growing in history. Notes IPO calendar has 'unmistakable feel of bell being rung' historically marking cycle tops. Discusses memory cycle risks with new capacity coming online 2027-2028 'precisely the supply-side dynamic that has reliably preceded every prior correction.' References 'elevated market concentration' and 'spillover effects on similarly leveraged bets.' Compares current environment to TMT bubble with language about 'toxic combination' of high valuations and unsustainable growth. However, manager also notes global market trading at 'more reasonable valuation level' than 1999-2000 and emphasizes portfolio quality provides protection, preventing score from reaching 0.85+ range.

Opportunity Density

75%

ScarceAbundant

Abundant (75%)

Manager expresses strong view that opportunity set is rich, stating 'since inception in 2011, the portfolio's valuation relative to the market has never been better and we are excited about the opportunity present today.' Describes current environment as 'unusually attractive opportunity for investors who share SGA's philosophy' and 'incredibly compelling.' Initiated six new positions in single quarter, higher than usual activity, suggesting ample opportunities being identified. Manager states 'we see ample valuation support in the portfolio' and describes 'fertile ground for subsequent outperformance.' However, opportunities are characterized as selective and requiring patience ('build over time,' 'opportunistically'), preventing score from reaching 0.80+ range indicating broad-based opportunity across all sectors.

Time Horizon

78%

Short-TermLong-Term

Decade+ (78%)

Manager demonstrates multi-year investment horizon with explicit language about 'long-term compounding' and 'long-term investors.' Describes looking out '10 years and not just the next 1 or 2 years' when analyzing businesses. Uses phrases like 'over time, markets should reward fundamental strength' and 'real investment returns are generated by long term compounding rather than short term trading views.' Portfolio positioning based on 'next three years' growth expectations of 16% revenue and 20% earnings. Manager held Equinix for 'ten years' previously and describes businesses with 'enduring earnings power' and 'durable competitive advantages.' However, score capped below 0.85 because manager also discusses near-term catalysts like AI CapEx cycle maturation and memory capacity coming online 2027-2028, and actively trades around positions (12% quarterly turnover). Not permanent capital structure but clear multi-year thesis orientation.