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ClearBridge Growth I SAGYX Fund Analysis

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Morningstar’s Analysis SAGYX

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A New Name and New Comanager Incoming; Ratings Unchanged

null Jack Shannon

Jack Shannon

Analyst Note

ClearBridge Aggressive Growth is getting rebranded as ClearBridge Growth effective May 1, 2024. In addition, its official benchmark is changing from the Russell 3000 Growth Index to the Russell Midcap Growth Index. However, these changes will not affect the day-to-day management of the portfolio, as it has virtually no index-relative constraints. Its Morningstar Medalist Rating remains unchanged. The “aggressive growth” moniker has not made sense in years, as there were periods under previous manager Richie Freeman’s tenure that the portfolio nearly landed in value waters. However, the strategy has a new direction under Aram Green’s watch. Green has a small- and mid-cap growth background, and while this fund currently sits in the large-blend Morningstar Category, it has been getting steadily growthier under Green’s command. This name change is supposed to reflect the reality that this portfolio is essentially an all-cap mandate. Green tends to invest in smaller-cap companies than peers, and its Morningstar Size Score ranks among the lowest in the category. While Green will own growth stocks up-and-down the market-cap ladder in this strategy, he likely will not own the dominant mega-cap technology companies, as he is looking for unique, emerging businesses that can grow into tomorrow’s behemoths. From that perspective, switching to the Russell Mid-Cap Growth Index makes some sense, as the Russell 3000 Growth is dominated by those mega-cap technology companies. This fund is still likely to have significantly more large-cap exposure than its new Russell Midcap Growth Index. Overall, investors should expect this strategy to settle near the large-growth and mid-cap-growth border, though it will likely be a tough one to benchmark owing to its non-cookie-cutter portfolio. In addition to the name change, Amanda Leithe will be named comanager on the portfolio effective May 1. Leithe has served as a portfolio analyst—effectively a portfolio-manager-in-waiting role—on this strategy for a couple of years, so she is well-versed in both the investment philosophy and the portfolio.

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