TM Natixis Loomis Sayles US Eq Ldrs N/A £
Why is this fund on our radar?
TM Natixis Loomis Sayles US Equity Leaders has a long track record of generating above-market returns from a concentrated portfolio. As the portfolio shows, high returns can come from a variety of businesses and sectors, and although the US market’s dominant technology sector has certainly played a starring role in the fund’s performance, its additional focus on businesses in other areas such as industrials and financials gives investors exposure to companies whose own growth trajectory may be accelerating with the assistance of technology. Thus the fund, while concentrated, provides a more diversified way to play growth trends than, say, a technology sector specialist. This more diversified approach comes across in our qualitative analysis, which shows a good balance between active management indicators such as difference from the index (as measured by tracking error) and outperformance (as measured by alpha), having done so on a consistent basis, and explaining the fund’s presence in our list.
Skip to Our VerdictPerformance
TMLF has an excellent long-term track record, compounding at 16.7% and 18.3% over 5 and 10 years respectively, compared to the benchmark S&P500’s 15.7% and 15.6% and the IA North America peer group’s 13.0% and 13.1%.
Given the concentrated nature of the portfolio, with the top ten making up almost 60% of the whole, one might expect performance to vary considerably from the index, and the chart below, showing discrete calendar year performance over the last five years confirms this. The fund significantly underperformed in 2022, a year marked by interest rate rises. This triggered the rapid decline of many stocks in the US and elsewhere, and the fund was not immune. Conversely, as growth forecasts for some companies in the US began to increase as expectations around AI rose 2023 and 2024, the portfolio significantly outperformed. In 2025 it’s probably fair to say that US shares have been swept along by politics more than by how well individual companies are performing, with the US adopting a robust but unpredictable approach to negotiating trade tariffs that markets have found difficult to read. Given the more volatile nature of the fund’s very concentrated portfolio, this could create opportunities for long-term investors. While higher growth businesses are by their nature inclined to be unpredictable in the shorter-term, this may work in the favour of investors with a longer-term investment horizon and who are comfortable with volatility, buying on the dips. For example, the fund’s maximum drawdown, that is, the largest decline in value it recorded during a given period (2025),5 is 26%, from late January to early April, reaching a trough shortly after the White House’s so-called Liberation Day. Since the trough to the end of the July the fund is almost back to where it was at the peak, underperforming on the way down, but outperforming on the way back up.
discrete annual performance
Source: Morningstar
Past performance is not a reliable indicator of future returns
TMLF’s longer-term relative performance, compared both the IA North America peer group, which is a group of funds with a similar objective, and an ETF tracking the benchmark S&P500 Index is illustrated below, with its performance divided by the performance of the two comparators. In both cases, this shows that while the overall result is strong outperformance, there is a cyclical element to this, and investors can expect periods where the fund does less well compared to the index and more diversified competitors.
Relative performance
Source: Morningstar
Past performance is not a reliable indicator of future results
Portfolio
TMLF’s portfolio consists of 30-40 companies, but as one can see from the table below, the top ten, at almost 60% of the total, is a very high conviction list of stocks that exemplify the approach, focusing on large companies which they believe still have the potential to grow, and defensible business models. The manager takes a ‘private equity’ style approach, with a ‘long-term owner’ rather than ‘short-term shareholder’ mentality and investors can therefore expect stocks to stay in the portfolio for long periods. ‘Growth’ is often closely associated with the technology sector, but in fact the fund has a relatively neutral sector weighting in technology. One could argue that many of its holdings are likely to drive growth through the implementation of technology.
top ten holdings
| holding |
% |
| NVIDIA Corp |
9.6 |
| Meta Platforms Inc |
8.1 |
| Tesla |
6.3 |
| Netflix |
5.7 |
| Amazon.com |
5.7 |
| Microsoft |
4.8 |
| Boeing |
4.8 |
| Oracle |
4.7 |
| Alphabet |
4.7 |
| Visa |
4.4 |
|
TOTAL |
58.8 |
Source: Natixis, as of 30/06/2025
The table below gives a snapshot of some fundamental measures that many investors use to assess the prospects for a share price. While the fund’s manager seeks to invest in companies at a price below what they believe to be intrinsic value, in practice this results in companies which might be considered ‘expensive’, with conventional valuation measures such as price to earnings ratio, or price to book value, all significantly higher than the average for the index. A reader doesn’t need a precise understanding of what these measures mean, the key point here is that while these companies may appear expensive, they are attractive to the fund manager because they believe that their future growth prospects are sufficiently strong to justify that price today.`
Success, then, depends on the fund’s manager getting the assessment of a business’s growth prospects correct. A higher valuation may, in a few years, look cheap if growth exceeds market expectations.
Portfolio metrics
| fund |
comparative benchmark |
|
| Dividend yield |
0.5 |
1.2 |
| Price/Book |
7.8 |
4.9 |
| Price/Sales |
5.9 |
3.2 |
| Price/Earnings |
30.5 |
24.5 |
Source: Natixis, as of 30/06/2025
Our Verdict
In 2025 there has been a very real debate among investors about the US’s exceptional nature. In fact, this goes beyond mere debate, with global fund flows indicating a reallocation of capital, with Europe one notable beneficiary. That said, the US remains the pre-eminent equity market and casting one’s eye down the list of the fund’s top holdings, one is reminded that the country is home to some truly exceptional growth companies. When companies grow fast, it’s statistically quite likely that actual earnings growth will occasionally be wildly different from Wall Street’s forecasts, and a so-called quarterly earnings ‘miss’ might lead to more volatility that some investors are prepared for. But in our view, one can slice and dice equity strategies in a hundred different ways but ultimately investing in equity is about owning a part of a company’s success or failure. The fund provides exposure to companies where failure might be more likely than a steady consumer staples business, but where success could result in a return many multiples higher. Individual investors’ appetite for risk will vary, and a fund such as this, which has an outstanding but volatile track record, probably shouldn’t be considered a ‘core’ dependable equity fund. But it does provide investors with a portfolio that in many ways exemplifies what investing equities is all about.
Key Risks
- A very concentrated portfolio of 30-40 stocks, with the top 10 c. 60% of the total means individual stock risk is high
- Average portfolio company trades at a higher valuation than the market,which could be a source of volatility
- Long-term outperformance is likely to be punctuated by periods ofunderperformance
