Insights
“Sentiment and currency played much larger roles than fundamentals this year.”
Each quarter, Chris Armbruster, CFA Portfolio Manager and Senior Research Analyst, provides an update on the performance of the Large Cap Growth strategy and shares his market outlook. Listen to his most recent episode where Chris recaps market activity during 1Q 2026.
Key Insights and Trends
- Equity markets pulled back during the quarter amid escalating geopolitical conflict, higher energy prices, and renewed inflation risk, despite corporate margins remaining near record levels
- Rapid advances in agentic AI increased uncertainty around the durability of intangible value, weighing on software and business services companies viewed as more vulnerable to disruption
- Relative performance reflected the strategy’s exposure to businesses with intangible value propositions, alongside selective positioning in hyperscalers with clearer internal paths to AI monetization
- Active portfolio decisions included reassessing valuation frameworks and exiting select holdings where AI‑driven disruption risk appeared to be increasing
- Discussion focused on how varying approaches to integrating AI into consumer hardware and software ecosystems could influence long‑term product demand, pricing power, and replacement cycles
- Primary contributors and detractors to the Large Cap Growth strategy
Stay Informed with Our Latest Insights
For more insights, read our 1Q 2026 Market Review Commentary or subscribe to KayneCast where we provide the latest updates from the KAR Investment Team on our investment strategies.
Kaynecast is available on Apple Podcasts and Spotify.
This information is being provided by Kayne Anderson Rudnick Investment Management, LLC (“KAR”) for illustrative purposes only. Information contained in this material is not intended by KAR to be interpreted as investment advice, a recommendation or solicitation to purchase securities, or a recommendation of a particular course of action and has not been updated since the date of the material, and KAR does not undertake to update the information presented should it change. This information is based on KAR’s opinions at the time of the recording of this material and are subject to change based on market activity. There is no guarantee that any forecasts made will come to pass. KAR makes no warranty as to the accuracy or reliability of the information contained herein. Past performance is no guarantee of future results.
