Overview
- In its Q1 2026 letter, the fund reported a 9.0% decline versus a 4.3% drop for the S&P 500 and said two thirds of the gap came from sector bets with the rest from stock picks.
- The letter linked the downturn to the war with Iran, which lifted oil prices and increased market swings.
- Baron made MSCI its largest new purchase for the quarter, pointing to proprietary index data and an AI boost after CEO Henry Fernandez said “AI is a godsend to us.”
- CME Group was a leading bright spot, with shares up 10.8% on stronger futures and options activity and record first quarter revenue of $1.9 billion.
- The fund follows a long only strategy that targets 100 to 200 basis points of annualized outperformance while seeking to avoid permanent losses.