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Quarter	Letter Date	Fund Name	QTD	YTD	Tickers	Themes	Quick Take

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Baird Small/Mid Cap Growth Equity Fund 2026 Q1 Investor Letter | Buyside Digest

Back to Fund Profile (Baird Small/Mid Cap Growth Equity Fund)

Primary Source Intelligence • Q1 2026 Letter Analysis

Baird Small/Mid Cap Growth Equity Fund Quarterly Analysis

Buyside Digest is not affiliated with, and does not endorse, Baird Small/Mid Cap Growth Equity Fund. This analysis is provided for institutional research purposes only and is not investment advice.

Fund Returns

QTD-5%

YTD-5%

Annualized+9.13%

Positioning StanceNEUTRAL

Market CapSMID Cap

GeographyUS

Digest Analysis

Quick Take

"5%. Technology outperformed through semiconductor additions while industrials benefited from aerospace and AI infrastructure exposure."

Executive Summary

Baird's SMID-cap growth strategy underperformed in Q1 2026 amid geopolitical volatility, declining 4.8% versus benchmark's 3.5%. Technology outperformed through semiconductor additions while industrials benefited from aerospace and AI infrastructure exposure. Active portfolio management included exiting software, adding semiconductors, and initiating new positions across industrials and healthcare. Portfolio remains well-positioned for opportunistic deployment during volatile periods.

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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%)

High conviction evidenced by significant portfolio changes including 12 new position additions and multiple exits. Manager provides detailed thesis for each new holding with specific catalysts and timeframes. Active management with sized positions demonstrates strong conviction in individual names.

Growth Outlook

38%

BearishBullish

Neutral (38%)

Manager acknowledges macro backdrop is clearly more complex with geopolitical risk, uncertain interest rates, and expects further volatility. However, maintains constructive view on using volatility opportunistically and sees attractive risk/reward in current holdings.

Risk Appetite

40%

DefensiveAggressive

Defensive (40%)

Portfolio remains fully invested with active position additions across multiple sectors. Added 12 new positions during the quarter while maintaining diversified exposure. No indication of defensive positioning or cash raising despite macro concerns.

Capital Deployment

45%

De-riskingDeploying

Net Neutral (45%)

Moderate deployment evidenced by adding 12 new positions while exiting others. No cash level data provided, but significant rotation and net additions suggest modest capital deployment. Active management indicates willingness to deploy capital selectively.

Forward Guidance

30%

CautiousExpansionary

Cautious (30%)

Manager expresses goal to use periods of volatility opportunistically to enhance portfolio fundamentals. Forward-looking language is constructive but measured, acknowledging complexity while maintaining deployment bias.

Language Signal

15%

BearishBullish

Bearish (15%)

Language balances opportunity identification with risk acknowledgment. Uses terms like attractive, positioned to benefit, and opportunistically, but also discusses challenging sectors, disappointing results, and complex macro backdrop.

Perceived Risk

65%

Low RiskElevated

Elevated Risk (65%)

Manager identifies multiple specific risks including geopolitical conflict, oil price spikes, inflation concerns, and uncertain interest rate path. Expects further volatility and significant stock price swings. Risk discussion is meaningful but not alarmist.

Opportunity Density

70%

ScarceAbundant

Abundant (70%)

Manager found 12 new investment opportunities across multiple sectors during the quarter. Identifies specific themes like AI infrastructure, aerospace/defense, and healthcare M&A. Selective but active approach suggests reasonable opportunity set.

Time Horizon

65%

Short-TermLong-Term

Multi-Year (65%)

Manager discusses multi-year themes like data center growth over next several years and long-term growth prospects. Focus on using volatility opportunistically for long-term return potential suggests medium-term investment horizon of 2-5 years.