Boston - Eaton Vance and its affiliates seek to actively capitalize on opportunities presented by volatile investor sentiment, while ensuring that the portfolio risk profile remains appropriate for the specific strategy. The following are excerpts from a recent conversation with Lewis R. Piantedosi and Yana S. Barton, CFA, Co-Directors of Growth Equity at Eaton Vance Management.
What we are seeing: After six weeks of focusing on the COVID-19 virus progression, the equity market is beginning to look forward and is now focused on the macro backdrop. Plans to reopen the economy at some point have started to emerge. This is an important transition for active managers. As we exit the haze and uncertainty of the virus, where there has been no such thing as a "safe haven," we can return to considering how an individual company's fundamentals could shake out when we get to the other side of the crisis. We see this market as ripe with potential for solid, stock-picking opportunities.
What we are doing: In a work-from-home world, we have all needed to make adjustments, but our Growth Equity team is as engaged, focused and productive as ever. We are in constant communication. Over the last month, we have held over 50 calls with managements of companies we own or companies we are interested in, as well as held over 30 calls with industry experts to help us get a handle on bigger-picture trends. In what has been a very difficult environment for everyone, we can feel really proud of our team's ability to get the job done.
What we are watching: Far from killing the megatrends that we follow, the impact of the virus has actually accelerated them in some cases. Long-term secular trends such as e-commerce, network security and direct-to-consumer media consumption — and especially innovations in health care and the importance of connectivity everywhere — are all moving to the forefront. We believe these trends will be a huge source of growth for years to come. That's why this is where we put the majority of our focus in growth investing.
Final word: Despite the challenges of work from home, our team has never been more engaged and productive. We are encouraged that the investing environment seems to be in transition, starting to look past the virus concerns and toward what the macro and micro considerations might become as plans are made to reopen for business. And the uncertainty of this pandemic period has reminded us why we maintain our focus on the stocks of companies both driving and thriving from disruptive long-term change — the secular growers that we believe should continue to excel.