The Virtus Silvant Mid-Cap Growth Fund recorded an impressive performance during the third quarter of 2025, surpassing its benchmark, the Russell Midcap Growth Index. This positive outcome was largely driven by the strong contributions from key holdings such as Palantir Technologies and Roblox. Conversely, some positions, including Fair Isaac Corp. and Verisk Analytics, acted as significant drag on the fund’s overall returns. The quarter also saw strategic shifts in the fund's portfolio, with new investments in Affirm Holdings and Astera Labs, alongside the divestment from Arthur J. Gallagher & Co., reflecting an active and adaptive investment strategy in response to evolving market dynamics.
This active management approach aims to capitalize on emerging opportunities and mitigate risks within the mid-cap growth segment, highlighting the fund’s commitment to generating competitive returns for its investors. The detailed analysis of both positive and negative contributors, as well as the recent portfolio reallocations, underscores the dynamic nature of managing a growth-oriented fund and its continuous effort to align with market trends and growth potential.
Exceptional Quarterly Returns
During the third quarter of 2025, the Virtus Silvant Mid-Cap Growth Fund delivered a robust return of +5.43% for its Class INST shares, significantly exceeding the +2.78% return posted by its benchmark, the Russell Midcap Growth Index. This outperformance highlights the fund's adept management in navigating the market and identifying strong growth opportunities. The superior returns were primarily fueled by successful investments in technology and entertainment sectors, demonstrating a keen eye for innovative companies with high growth potential. The fund’s strategy appears to be well-aligned with market trends, effectively leveraging market movements to generate value for its shareholders.
The impressive quarterly results underscore the effectiveness of the fund's investment philosophy and its ability to consistently identify and invest in companies that exhibit strong growth trajectories. The active management and diligent research conducted by the fund's team played a crucial role in handpicking securities that not only contributed positively to the portfolio but also enabled it to outperform a widely recognized market index. This sustained strong performance provides a compelling case for investors looking for growth opportunities within the mid-cap segment, reinforcing confidence in the fund's future prospects and its capacity to deliver ongoing value.
Strategic Portfolio Adjustments
The fund's strategic allocation decisions played a pivotal role in its quarterly success, particularly the impactful contributions from Palantir Technologies and Roblox. These companies, operating in the data analytics and immersive entertainment industries respectively, significantly boosted the fund’s performance, validating the investment team’s foresight in identifying high-growth innovators. However, the fund also faced challenges, with holdings like Fair Isaac Corp. and Verisk Analytics acting as notable detractors, indicating the inherent volatility and risks associated with growth investing. These mixed results underscore the necessity of continuous portfolio re-evaluation and adaptation to market conditions, ensuring that the fund remains agile and responsive.
In response to market shifts and evolving opportunities, the Virtus Silvant Mid-Cap Growth Fund executed several strategic portfolio adjustments during the quarter. Notably, new positions were initiated in Affirm Holdings, a leader in the buy-now-pay-later space, and Astera Labs, a company at the forefront of connectivity solutions for AI and cloud infrastructure. Simultaneously, the fund strategically divested from Arthur J. Gallagher & Co., an insurance brokerage and risk management firm. These targeted adjustments reflect the fund’s proactive approach to optimizing its holdings, aiming to enhance future returns by focusing on sectors and companies poised for significant growth, while divesting from those that no longer align with its strategic objectives or growth expectations. This dynamic management style is crucial for maintaining a competitive edge in the fast-paced mid-cap growth market.
