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Legg Mason ClearBridge US Aggressive Growth

Elite Rated by FundCalibre

Managed by an experienced and well-resourced team based in the US, this fund offers investors access to a high-conviction portfolio of predominantly larger US companies. Despite the title of the fund, the managers are conscious of valuations and we would describe this as a growth at a reasonable price type strategy.

Company Description

Baltimore-based Legg Mason was founded in 1889 and employs more than 3,000 employees across more than 30 offices worldwide. One of the twenty largest asset managers globally, it manages a broad mix of equities, fixed income, alternatives and cash strategies.

Factsheet_legg_mason_logo

Fund Manager

Richie Freeman designed the strategy in 1983 and has been at the helm ever since. Evan Bauman has been co-manager on the fund since 2009. The managers have built a long and impressive track record.

The Investment Process

Fundamental research forms the basis of the process, with the team meeting a huge number of companies and carrying out painstaking due diligence on potential portfolio holdings. Companies are often monitored for years before an investment is made. The output of the process is to identify non-consensus, secular growth stories with a beneficial industry structure. The depth of knowledge acquired through the process allows the managers to run a concentrated portfolio (top 10 holdings are typically 50% of the fund) and to deviate significantly from the benchmark. They also take a very long-term view, with annual portfolio turnover at around 10%.

Risk

The concentrated nature of the fund, its stark contrast to its benchmark, and the managers’ long-term approach mean this fund has potential to go through periods of underperformance. While the fund predominantly invests in larger companies, it also has a long tail of minor positions in smaller companies that could impact performance during market falls.

Our Opinion

To run a concentrated portfolio with very little turnover requires confidence and a deep understanding of portfolio companies and competitors. The size and strength of the team provide the platform for this. We believe the managers’ approach makes this a compelling option for investors with a long-term investment time horizon.

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