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Baron Funds, an investment management company, released its “Baron Technology Fund” first quarter 2025 investor letter. A copy of the letter can be downloaded here. Market trends are often driven by sentiment in addition to fundamental elements, and the first quarter of 2025 was a clear example of this. January saw a strong performance for the Fund, driven by investor excitement around long-term growth trends in AI. Optimism was fueled by expectations of the new Trump administration's policies to accelerate economic growth. However, by mid-February, fears of tariffs, a potential trade war, and geopolitical shifts reversed market gains, leading to significant volatility. In the first quarter, the fund fell 14.80% (Institutional Shares), underperforming an 11.64% decline for the MSCI ACWI Information Technology Index (the Benchmark) and a 4.27% decline for the S&P 500 index. In addition, please check the fund’s top five holdings to know its best picks in 2025.
In its first-quarter 2025 investor letter, Baron Technology Fund highlighted stocks such as The Trade Desk, Inc. (NASDAQ:TTD). Headquartered in Ventura, California, The Trade Desk, Inc. (NASDAQ:TTD) is a technology company that offers a self-service cloud-based ad-buying platform. The one-month return of The Trade Desk, Inc. (NASDAQ:TTD) was 61.25%, and its shares lost 7.87% of their value over the last 52 weeks. On May 12, 2025, The Trade Desk, Inc. (NASDAQ:TTD) stock closed at $79.40 per share with a market capitalization of $39.02 billion.
Baron Technology Fund stated the following regarding The Trade Desk, Inc. (NASDAQ:TTD) in its Q1 2025 investor letter:
"The Trade Desk, Inc. (NASDAQ:TTD) is the leading demand-side platform (DSP) in internet advertising, enabling agencies and brands to efficiently plan, buy, and measure digital advertising across desktop, mobile, online video, and Connected TV (CTV). Shares declined meaningfully during the quarter following the company’s first earnings miss in 33 quarters as a public company, along with forward guidance that came in slightly below investor expectations. The company cited several factors contributing to the softer outlook, including delays in the rollout of its next-generation Kokai platform, which advertisers use to manage their campaigns, as well as a strategic realignment of the sales organization to improve focus on the world’s largest advertisers.