Mawer Investment Management, an investment management firm, has released its Q2 2021 letter to investors – a copy of which can be downloaded here. Mawer International Equity Fund returned 3.5% for the second quarter of 2021, behind the benchmark international equity index, which returned 3.9% for the same period. On the other hand, the Mawer US equity fund returned 5.7%, behind the 6.9% return of the S&P 500 Index for the second quarter. You can check out the top 5 holdings of the fund to get an idea of ââtheir top bets for 2021.
In Mawer Investment Management’s Q2 2021 letter to investors, the fund mentioned Shopify Inc. (NYSE: SHOP) and discussed its position on the company. Shopify Inc. is an ecommerce company based in Ottawa, Canada with a market capitalization of $ 169.9 billion. SHOP has achieved a 20.20% year-to-date return, while its 12-month returns are up 32.65%. The stock closed at $ 1,443.81 per share on September 27, 2021.
Here’s what Mawer Investment Management has to say about Shopify Inc. in its Q2 2021 letter to investors:
âMany high-growth companies have shown strong results as part of the recovery in broader economic activity, including Shopify. These higher growth companies tend to have increased sensitivity to a change in discount rates and were supported when long-term interest rates stabilized during the period. “
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Based on our calculations, Shopify Inc. (NYSE: SHOP) was unable to land a spot on our list of the 30 most popular stocks among hedge funds. BOUTIQUE was in 85 hedge fund portfolios at the end of the first half of 2021, compared to 91 funds in the previous quarter. Shopify Inc. (NYSE: SHOP) has generated a return of -7.66% in the past 3 months.
The reputation of hedge funds as savvy investors has been tarnished over the past decade, as their hedged returns could not keep up with the unhedged returns of stock indices. Our research has shown that small cap hedge fund stock selection managed to beat the market by double digits every year between 1999 and 2016, but the margin for outperformance has shrunk in recent years. Nonetheless, we were still able to identify in advance a select group of hedge funds that have outperformed S&P 500 ETFs by 115 percentage points since March 2017 (see details here). We were also able to identify in advance a select group of hedge funds that underperformed the market by 10 percentage points per year between 2006 and 2017. Interestingly, the margin of underperformance of these stocks has increased in recent years. Investors who are long in the market and short on these stocks would have reported more than 27% per year between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter.
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