How PLGAX’s Portfolio Has Changed



PLGAX overview

The Principal LargeCap Growth Fund I Class A (PLGAX) invests at least 80% of its assets in equities of large-capitalization companies. The fund considers large-cap companies to be those whose market capitalizations are similar to those of companies that make up the Russell 1000 Growth Index.

The fund focuses on growth-oriented companies, which means that it focuses on companies whose capital and earnings growth potential are expected to be above average. The fund’s principal management invests 10%–30% of the fund’s assets in equity securities included in the Russell 1000 Growth Index to try to match or exceed its performance. The weights of these securities can either be higher or lower than they are in the index. The rest of PLGAX’s assets are managed by subadvisers.

Intuitive Surgical (ISRG), Starbucks (SBUX), Estée Lauder Companies (EL), Boeing Company (BA), and Amphenol (APH) were among the fund’s 619 holdings as of March 2016’s end. As of April, the fund was managing assets worth $7 billion.

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Portfolio changes in the Principal LargeCap Growth Fund I

For this analysis, we will be considering PLGAX’s holdings as of March 2016, as that is the most recent available sectoral breakdown. The fund’s holdings after March reflect valuation-driven changes to its portfolio, not its actual holdings.

The information technology, consumer discretionary, and healthcare sectors form the core of PLGAX. Combined, these three sectors form 68% of the fund’s portfolio. Industrials is the only other sector that commands over 10% of the fund’s assets.

In the year ended April 2016, PLGAX increased its exposure to the information technology and consumer discretionary sectors. The fund has also increased its holdings of telecommunications services stocks.

On the other hand, the energy sector has fallen completely out of the fund’s favor. The healthcare, industrials, and consumer staples sectors have seen their respective shares reduce.

How has the fund’s portfolio positioning impacted its returns year-to-date in 2016? We’ll explore this in the next article.


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