BayFort Capital’s Global Leaders Portfolio delivered a robust return of 7.7% in INR terms (7.68% USD) in June 2024, primarily driven by our positions in healthcare and AI sector stocks. A key factor in our overall returns is the absence of large negative-return stocks, which typically offset significant gains in a portfolio. We have deliberately avoided high-beta consumer discretionary stocks that reported lower-than-expected earnings and were subsequently penalized by the markets.
The market anticipates 1-2 rate cuts from the US Federal Reserve before the end of the year. With inflation having cooled substantially in recent months, we do not foresee any major obstacles to these expected rate cuts. Yields on longer-term Treasuries increased over the last week, while heightened expectations for a September Fed rate cut led to a slight decrease in short-term Treasury yields, resulting in a steeper yield curve and bullish tone of the markets.
Our portfolio returns have outperformed all major indices globally for all periods since inception. This stellar performance is due to our focus on high-growth, innovative businesses that are leaders in their respective sub-sectors. We are bullish on AI, Healthcare, and Drones for 2024. If you are not invested in these sectors, you may be missing the investment opportunity of the decade.