The Takeaway
Receding inflation during the quarter made for a more favorable market environment, with all style indexes closing in positive territory. Across the globe, growth fared better than value.
The margin of outperformance for US large growth was higher than for other size segments, with small-cap segments following behind.
Portfolio resets were mainly attributable to corporate actions and price fluctuations.
Globally, growth stocks' superior performance relative to value was driven largely by differences in intrasector stock selection and sector allocation.
From a style-agnostic perspective during the first quarter of 2023, large-cap US stocks outpaced the small and large counterparts, and growth performed much better than value across all segments predominantly due to predominant macro uncertainties around Fed hike and banking crisis. Similarly, in developed markets outside the US, growth stocks outpaced their value counterparts.
US Large Broad Growth being overweight the technology and consumer cyclical sectors, along with being underweight financial services, were the most notable sector tilts that contributed to better performance in large-cap growth stocks in the US.
In the United States, large-value stocks' underperformance relative to growth was driven primarily by differences in selection effects.
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