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1.22.21
2021 Global Outlook
Ivy Investments believes the path forward requires a disciplined approach that combines resilience and a reliance on the fundamentals of active investing.
CIO Insights / 2.05.20
The beginning of a new cycle
We assess the current environment and offer 2021 market observations and the possible implications for investors.
11.18.20
Ivy Investments Forum
We recently gathered a number of thought-provoking experts who shared their latest views on an array of critical issues impacting today’s investing landscape. Watch the session replays to get our panelists’ insights.
Webcasts / 02.05.21
The Pandemic Time Capsule
How Covid-19 Impacts Every Generation and What This Means for a Plan Forward
Genlink
Raising financially smart kids
Passing on life lessons from generation to generation is important, especially when it comes to topics like money. Discover strategies to raising financially smart kids.
Genlink
Three plans every Gen Xer needs to consider before they turn 50
Xers - hitting the big 5-0 is a big milestone. Uncover the three essential plans you may want to consider to protect your family and yourself.
Our Company
Ivy Investments
We stand for a legacy of expertise, focused on delivering strong, long-term results. Our name reflects our progressive product offerings and growing global presence as we continue to adapt to the needs of investors.
Quarterly Commentary
Ivy Small Cap Growth Fund
12.31.20
Market Sector Update
The market had the “momentum” in the fourth quarter and small-cap stocks had a record quarter of absolute returns.
The broader Russell 2000 Index was up over 31% for the quarter, with the value component of the index outperforming
the growth component.
During the quarter, small caps outperformed both mid and large caps as the market sentiment shifted to a risk-on,
economic recovery mode. The successful trials of the two leading COVID-19 vaccines provided a catalyst for the
economic-sensitive stocks that had been lagging in the previous nine months.
Within the Russell 2000 Growth Index (the Fund’s benchmark), sector winners in the quarter were energy, information
technology, industrials and health care. Information technology gains were led by the more cyclical hardware and
semiconductor stocks, while biotechnology companies had another quarter of strong performance to boost the health
care sector.
Portfolio Strategy
While the Fund had strong performance in the quarter, slightly lagging the benchmark, its performance remained
well ahead of the index for the 12-month period.
The difficulty in the quarter was matching the strong gains coming out of the cyclical component of the index
combined with some spectacular gains in a few “concept” areas like solar and green energy stocks. The Fund
participated to some extent in the latter boom, with positions in Enphase Energy and Plug Power both rising more than
100% in the quarter. Significant gains came from several holdings’ (CareDx, Inc., Vericel Corp. and Veracyte, Inc.)
participation in the biotech frenzy during the quarter.
In the more cyclical growth areas of the Fund, Brink’s Company and Shift4Payments were winners along with Visteon
and Seacoast Banking of Florida. At the sector level, the Fund squeezed out gains in industrials and financial services
but fell short a bit in information technology, health care and consumer discretionary. The powerful bounce off the
bottom in the economic-sensitive areas of the latter three sectors was the primary cause of the modest shortfall in
performance.
The Fund has made a few incremental changes to increase exposure in these areas with new positions in financial
services and industrials while harvesting some long-term contributors, like Hubspot, that have moved out of our
strategy’s market-cap range.
Outlook
As unpredictable as 2020 was, the lesson learned was to maintain the Fund’s core stock selection discipline, which
has proven over the years to be a successful strategy. We believe the market ultimately rewards the small-cap growth
companies that deliver sales and earnings growth and returns on capital that merit the high valuations often achieved.
The pandemic in some cases validated and accelerated the adoption of the innovative growth models that the Fund
is always pursuing. The outlook for 2021 seems brighter with the rollout of the vaccine but there will undoubtedly be
the unexpected turn of events that lead to market volatility. Innovation is in full stride; however, which we think is an
ideal environment to invest in small-cap growth companies.
The opinions expressed are those of the Fund’s managers and are not meant as investment advice or to predict or project the future performance of any investment product. The opinions are current through Dec.
31, 2020, are subject to change at any time based on market and other current conditions, and no forecasts can be guaranteed. This commentary is being provided as a general source of information and is not
intended as a recommendation to purchase, sell, or hold any specific security or to engage in any investment strategy. Investment decisions should always be made based on an investor’s specific objectives, financial
needs, risk tolerance and time horizon.Past performance is not a guarantee of future results.
All information is based on Class I shares.
The Russell 2000 Growth Index measures the performance of the small-cap growth segment of the U.S. equity universe. It is not possible to invest directly in an index.
Top 10 holdings as a % of net assets as of 12/31/2020: Biotech Swap 7/1/21 4.1, Five9, Inc. 3.5, CareDx, Inc. 3.0, Varonis Systems, Inc. 2.7, PetIQ, Inc. 2.3, Monolithic Power Systems, Inc. 2.2, Brink’s Company 2.1, Mercury
Systems, Inc. 2.1, Globant SA 2.1 and Vericel Corp. 2.1.
The impact of COVID-19, and other infectious illness outbreaks that may arise in the future, could adversely affect the economies of many nations or the entire global economy, individual issuers and capital markets
in ways that cannot necessarily be foreseen. In addition, the impact of infectious illnesses in emerging market countries may be greater due to generally less established healthcare systems. Public health crises
caused by the COVID-19 outbreak may exacerbate other pre-existing political, social and economic risks in certain countries or globally. The duration of the COVID-19 outbreak and its effects cannot be determined
with certainty.
Risk factors: The value of the Fund’s shares will change, and you could lose money on your investment. Investing in small-cap stocks may carry more risk than investing in stocks of larger more well-established
companies. The Fund may invest in Initial Public Offerings (IPOs), which can have a significant positive impact on the Fund’s performance that may not be replicated in the future. An investment in the Fund is not a
bank deposit and is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Not all funds or fund classes may be offered at all broker/dealers. These and other risks
are more fully described in the Fund’s prospectus.
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Ivy offers model delivery for nine equity strategies
Nine strategies are available in a model-delivery format, to be available in SMA and UMA accounts, providing advisors and investors a new way to access Ivy’s strategies.
Ivy InvestEdSM 529 Plan
A flexible, tax-advantaged 529 plan that allows you to invest for future education goals.
2021 Global Outlook
Ivy Investments believes the path forward requires a disciplined approach that combines resilience and a reliance on the fundamentals of active investing.
The beginning of a new cycle
We assess the current environment and offer 2021 market observations and the possible implications for investors.
Ivy Investments Forum
We recently gathered a number of thought-provoking experts who shared their latest views on an array of critical issues impacting today’s investing landscape. Watch the session replays to get our panelists’ insights.
The Pandemic Time Capsule
How Covid-19 Impacts Every Generation and What This Means for a Plan Forward
Raising financially smart kids
Passing on life lessons from generation to generation is important, especially when it comes to topics like money. Discover strategies to raising financially smart kids.
Three plans every Gen Xer needs to consider before they turn 50
Xers - hitting the big 5-0 is a big milestone. Uncover the three essential plans you may want to consider to protect your family and yourself.
Ivy Investments
We stand for a legacy of expertise, focused on delivering strong, long-term results. Our name reflects our progressive product offerings and growing global presence as we continue to adapt to the needs of investors.
Quarterly Commentary
Ivy Small Cap Growth Fund
Market Sector Update
Portfolio Strategy
Outlook
The opinions expressed are those of the Fund’s managers and are not meant as investment advice or to predict or project the future performance of any investment product. The opinions are current through Dec. 31, 2020, are subject to change at any time based on market and other current conditions, and no forecasts can be guaranteed. This commentary is being provided as a general source of information and is not intended as a recommendation to purchase, sell, or hold any specific security or to engage in any investment strategy. Investment decisions should always be made based on an investor’s specific objectives, financial needs, risk tolerance and time horizon.Past performance is not a guarantee of future results.
All information is based on Class I shares.
The Russell 2000 Growth Index measures the performance of the small-cap growth segment of the U.S. equity universe. It is not possible to invest directly in an index.
Top 10 holdings as a % of net assets as of 12/31/2020: Biotech Swap 7/1/21 4.1, Five9, Inc. 3.5, CareDx, Inc. 3.0, Varonis Systems, Inc. 2.7, PetIQ, Inc. 2.3, Monolithic Power Systems, Inc. 2.2, Brink’s Company 2.1, Mercury Systems, Inc. 2.1, Globant SA 2.1 and Vericel Corp. 2.1.
The impact of COVID-19, and other infectious illness outbreaks that may arise in the future, could adversely affect the economies of many nations or the entire global economy, individual issuers and capital markets in ways that cannot necessarily be foreseen. In addition, the impact of infectious illnesses in emerging market countries may be greater due to generally less established healthcare systems. Public health crises caused by the COVID-19 outbreak may exacerbate other pre-existing political, social and economic risks in certain countries or globally. The duration of the COVID-19 outbreak and its effects cannot be determined with certainty.
Risk factors: The value of the Fund’s shares will change, and you could lose money on your investment. Investing in small-cap stocks may carry more risk than investing in stocks of larger more well-established companies. The Fund may invest in Initial Public Offerings (IPOs), which can have a significant positive impact on the Fund’s performance that may not be replicated in the future. An investment in the Fund is not a bank deposit and is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Not all funds or fund classes may be offered at all broker/dealers. These and other risks are more fully described in the Fund’s prospectus.