MAB Quarterly Review Q1 2025 - Growth - Flipbook - Page 9
One notable feature of equity markets this year has been the signi昀椀cant underperformance of a style known
as “Quality”. This style is represented through managers who focus on buying quality companies, typically
evidenced by businesses that have a proven record of being able to generate stable, growing pro昀椀ts through
good and bad economic environments, often reinvesting some of those pro昀椀ts back into their businesses so
they get steadily stronger over time. These companies are often not the most exciting or fast growing but they
are deemed to be relatively stable through all sorts of economic environments and are typically characterised
by a strong 昀椀nancial position and low levels of debt so they can act from a position of strength when others
are suffering. Although we are in a year where the market has been ignoring these quality businesses and
instead bidding up defence businesses, companies linked to AI spend or those linked to precious metals/gold,
we know from experience that this will not always be the case and these “steady-Eddie” quality businesses can
be very helpful for your portfolios in less buoyant market environments. This year we have brought in two new
managers investing in such a manner, namely Evenlode UK Select Fund and GMO Quality Investment Fund,
and although their recent results have lagged their respective market comparators, we are very happy holders
of these funds and are con昀椀dent that their time will come.
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