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This report summarizes the performance and attribution of the Polen Global Growth Composite Portfolio during the third quarter of 2025. It highlights key drivers of returns, both positive and negative, and offers insights into the strategic positioning of the portfolio within the broader market context.

The quarter saw the portfolio achieve a modest return, underscoring the team's investment philosophy centered on identifying high-quality growth companies. Despite market fluctuations, the portfolio aims for durable earnings growth and long-term outperformance by carefully selecting companies with strong fundamentals and competitive advantages. This approach emphasizes thorough research and a deep understanding of each holding's business model and market position.

Quarterly Performance and Key Contributors

In the third quarter of 2025, the Polen Global Growth Composite Portfolio delivered a gross return of 3.0%, translating to a net return of 2.7% after fees. This performance occurred in a market where the broader benchmark showed a 7.7% return, indicating a period of relative underperformance for the portfolio. A significant positive influence on the portfolio's results was Oracle, which continued to be a top holding and a leading contributor to relative performance. This strong showing by Oracle followed an impressive set of quarterly results that demonstrated the company's robust operational execution and market strength. The favorable impact from Oracle underscores the portfolio's strategy of investing in high-quality companies that can deliver strong earnings growth and maintain competitive advantages.

The portfolio's returns for Q3 2025 were 3.0% before fees and 2.7% after fees. Oracle was a standout performer, boosting the portfolio's relative gains with strong quarterly earnings. This performance highlights the value of selecting companies with solid fundamentals and consistent growth. Despite a market benchmark return of 7.7%, the portfolio's strategic focus on robust businesses like Oracle helped mitigate broader market challenges. The team's conviction in companies exhibiting sustainable growth traits and significant market positions is central to their investment methodology. Oracle’s contribution validates the rigorous selection process and the belief in holding companies with predictable revenue streams and strong business moats, aiming for sustained long-term capital appreciation for investors.

Challenges and Strategic Positioning in Information Technology

The primary factor contributing to the portfolio's relative underperformance during Q3 2025 was its specific allocation within the information technology sector. While the sector generally possesses appealing characteristics, the portfolio's particular positioning did not fully capture the broader market's gains in this area during the quarter. However, the management believes that simply attributing this underperformance to the information technology sector is an oversimplification. This viewpoint overlooks crucial aspects such as the high proportion of recurring revenues, healthy profit margins, and significant switching costs associated with the companies held within the portfolio's technology investments. These inherent strengths are considered vital for long-term growth and stability, despite short-term market fluctuations that may impact relative performance.

Despite challenges in the information technology sector during Q3 2025, leading to a relative drag on performance, the investment team maintains a strategic conviction in their holdings. They argue that a superficial analysis of this underperformance overlooks fundamental strengths like recurring revenue models, substantial profit margins, and high customer switching costs embedded in their technology investments. These attributes are believed to provide a durable foundation for future growth and resilience, even when short-term market dynamics are unfavorable. The portfolio's strategy emphasizes these intrinsic qualities, rather than chasing transient trends, aiming to achieve sustained capital appreciation over the long haul. This approach is rooted in the belief that companies with strong competitive advantages and predictable cash flows will ultimately deliver superior returns, reinforcing the fund's commitment to its long-term investment philosophy.