We are pleased to provide you with a summary report on the performance of the WCM Quality Global Growth Strategy (the Strategy) for July 2026.
The Strategy1 delivered a return of -5.07% during the month, compared with the benchmark MSCI All Country World Index (the Benchmark) return of -1.26%. The Strategy has delivered returns in excess of the Benchmark over three and 10 years and since inception.
Strategy Update
Global equity markets were broadly unchanged in July at the headline level, though this masked considerable divergence in returns across regions and sectors. The month began with an escalation in the Iran conflict, which temporarily pushed Brent Crude above $100 per barrel. While bond yields rose in response to the likely impact on inflation, equity markets were more insulated, reflecting the consensus view that a slide back into a full-scale war is unlikely. At the stock level, the market’s focus was primarily on companies exposed to the Artificial Intelligence (AI) investment cycle. Semiconductor and AI infrastructure stocks fell sharply, reflecting both profit taking following recent strong performance and growing concerns over valuations and progress being made by Chinese competitors. Regional performance reflected the relative weightings of indices to AI. Markets with minimal AI exposure like the UK and Europe led gains, while the semiconductor-heavy indices of South Korea and Taiwan fell sharply. The U.S. market was close to unchanged as weakness in AI-related stocks were offset by gains elsewhere. The same sector divergence, led by Energy on one side and Technology on the other, also helped value outpace growth over the month.
The underperformance of the portfolio in July was in the main due to stock selection. Looking at stock selection by sector, Consumer Discretionary and Health Care were the best performing sectors relative to the Benchmark. Stock selection in Information Technology detracted from returns, driven largely by holdings across the semiconductor space. The returns from the portfolio’s industrial holdings were mixed, but in aggregate lagged the market as did exposures to the Materials sector. From a sector allocation perspective, being underweight to Information Technology was the largest positive contributor followed by overweight positions in Health Care and Real Estate relative to the Benchmark. On the other hand, being overweight to Industrials and underweight positions in Energy and Financials detracted from performance relative to the Benchmark.
Recent trading activity has centred on upgrading the portfolio’s exposure to AI. The addition of Ireland-based Seagate in the June quarter is one example of this. Seagate is a leading provider of high-capacity hard disk drives (HDD) for hyperscale data centres, generating approximately 80% of its revenue from data centre (cloud and enterprise) customers. In recent years, the HDD industry has consolidated from a half dozen to just three players. At the high-capacity nearline end that serves hyperscalers, it is effectively a duopoly between Seagate and Western Digital. This consolidation has created a dramatically improved market structure with capacity rationalisation and discipline on pricing. These favourable developments are coinciding with a strengthening tailwind driven by cloud expansion and increasingly storage-intensive AI workloads. Seagate, having addressed prior pricing and supply issues, is poised to accelerate its earnings growth. Additionally, Seagate has developed a technology called Heat Assisted Magnetic Recording (HAMR), further supporting a positive moat trajectory.
Market gyrations driven by fluctuations between risk-on and risk-off are not new. These cycles have always defined the short-term behaviour of equity markets, though admittedly the distance between them has shortened in recent years. What changes is the specific catalyst: tariffs, geopolitics, a new technology wave, etc. The underlying dynamic does not. Moat trajectory and culture serve as WCM Investment Management’s (WCM) compass for exactly this reason. They don’t insulate portfolios from volatility, but they do give a consistent basis for separating businesses whose competitive positions are genuinely strengthening from those whose prices are simply moving with the cycle. That basis is durable; how precisely WCM applies it continues to evolve. Better reads on moat trajectory, sharper cultural assessments, more deliberate portfolio construction are the ongoing work. When markets oscillate between fear and greed, WCM believes the advantage belongs to the investor who knows what they own and why it compounds. The market changes constantly. WCM’s long-term framework does not.
Notes: 1. WQG, WCMQ and WCM Quality Global Growth Fund (Managed Fund) have the same Portfolio Managers and investment team, the same investment principles, philosophy, strategy and execution of approach as those used for the WCM Quality Global Growth Strategy however, it should be noted that due to certain factors including, but not limited to, differences in cash flows, management and performance fees, expenses, performance calculation methods, and portfolio sizes and composition, there may be variances between the investment returns demonstrated by each of these portfolios and the WCM Quality Global Growth Strategy (the Strategy) in the future. As WQG, WCMQ and WCM Quality Global Growth Fund (Managed Fund) have only been in operation for a relatively short period of time, this table makes reference to the Strategy to provide a better understanding of how the team has managed this strategy over a longer period. Performance is net of fees and includes the reinvestment of dividends and income. 2. Strategy inception date is 31 March 2008. 3. Benchmark refers to the MSCI All Country World Index (with gross dividends reinvested reported in Australian Dollars and unhedged). 4. Value Added equals Strategy performance minus Benchmark performance. 5. Annualised.
DISCLAIMER: AGP Investment Management Limited (AGP IM) (ABN 26 123 611 978, AFSL 312247) is a wholly owned subsidiary of Associate Global Partners Limited (AGP) (ABN 56 080 277 998), a financial institution listed on the ASX (APL). AGP IM has prepared this material for general information purposes only for WCM Global Growth Limited, a listed investment company (ASX: WQG).
AGP IM is the responsible entity for WCM Quality Global Growth Fund - Active ETF (ARSN 625 955 240) (ASX: WCMQ) and WCM Quality Global Growth Fund (Managed Fund) (ARSN 630 062 047).
AGP International Management Pty Ltd (AIML) (ABN 33 617 319 123) is the investment manager for WQG and is an authorised representative of AGP IM. WCM Investment Management, LLC (WCM) is the underlying manager and applies its WCM Quality Global Growth Equity Strategy (the Strategy), excluding Australia, in managing each of WQG, WCMQ and WCM Quality Global Growth Fund (Managed Fund)(the Funds). WCM Investment Management, LLC is exempt from the requirement to hold an Australian Financial Services License under ASIC Corporations (Repeal and Transitional) Instrument 2016/396 and is regulated by the U.S. Securities and Exchange Commission under U.S. law, which differs from Australian law. WQG and AIML are part of the AGP Group.
Any references to ‘We’, ‘Our’, ‘Us’, or the ‘Team’ used in the context of the portfolio commentary, is in reference to WCM Investment Management, as investment manager for the Strategy or AIML as investment manager for WQG.
Even though the Strategy, excluding Australia, is applied to each of WQG, WCMQ and WCM Quality Global Growth Fund (Managed Fund) certain factors including, but not limited to, differences in cash flows, fees, expenses, performance calculation methods, portfolio sizes and composition may result in variances between the investment returns for each portfolio. The performance of the Strategy is not the performance of the portfolios and is not an indication of how WQG, WCMQ and WCM Quality Global Growth Fund (Managed Fund) would have performed in the past or will perform in the future.
The material should not be viewed as a solicitation or offer of advice or services by WCM, AGP or AGP IM. It does not contain investment recommendations nor provide investment advice. It does not take into account the objectives, financial situation or needs of any particular individual. Investors should, before acting on this material, consider the appropriateness of the material.
Neither AGP IM, AGP, their related bodies corporate, entities, directors or officers guarantees the performance of, or the timing or amount of repayment of capital or income invested in the Funds or that the Funds will achieve its investment objectives. Past performance is not indicative of future performance.
Any economic or market forecasts are not guaranteed. Any references to particular securities or sectors are for illustrative purposes only and are as at the date of publication of this material. This is not a recommendation in relation to any named securities or sectors and no warranty or guarantee is provided that the positions will remain within the portfolio of the funds. Any securities identified and described are for illustrative purposes only and do not represent all of the securities purchased, sold or recommended for client accounts. The reader should not assume that an investment in the securities identified was or will be profitable.
Investors should seek professional investment, financial or other advice to assist the investor determine the individual tolerance to risk and needs to attain a particular return on investment. In no way should the investor rely on information contained in this material.
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