In the third quarter of 2025, the Alger Mid Cap Growth Fund's Class A shares achieved a notable outperformance compared to the Russell Midcap Growth Index. This period saw Information Technology and Industrials emerge as the predominant sector weightings within the portfolio. Specifically, the Information Technology sector was notably overweighted, while Consumer Discretionary experienced a significant underweighting.
Detailed Investment Performance Insights for Q3 2025
During the three-month period ending September 30, 2025, the Alger Mid Cap Growth Fund demonstrated a strong showing, with its Class A shares exceeding the returns of the Russell Midcap Growth Index. Several companies were pivotal in this success. Astera Labs, Inc., a prominent innovator in connectivity solutions, contributed positively to the fund’s performance. Similarly, Robinhood Markets, Inc., a leading financial services platform, and Talen Energy Corp, an independent power producer, also played significant roles as top performers, bolstering the fund's overall returns.
Conversely, certain holdings acted as headwinds during this quarter. Constellation Software Inc., a diversified software company, was among the primary detractors. Verisk Analytics, Inc., a data analytics and risk assessment firm, and Axon Enterprise Inc, known for its public safety technology, also weighed down the fund's performance during this period.
From a sector allocation perspective, the fund maintained substantial positions in Information Technology and Industrials. The strategic overweighting in Information Technology reflected a bullish stance on the sector's growth potential, whereas the underweighting in Consumer Discretionary suggested a more cautious outlook on consumer-driven segments.
This performance highlights the dynamic nature of mid-cap growth investing and the importance of both individual stock selection and sector allocation strategies. The fund's ability to identify and capitalize on high-growth opportunities, while managing exposure to underperforming segments, proved crucial in delivering competitive returns.
This quarterly review offers valuable insights for investors interested in mid-cap growth strategies. The detailed breakdown of contributing and detracting factors, alongside sector allocations, underscores the active management approach employed by the fund. It reminds us that successful investing often involves a nuanced understanding of market dynamics and a willingness to make strategic adjustments in response to evolving economic landscapes. The robust performance against its benchmark suggests a well-executed strategy, providing a positive outlook for future endeavors in this volatile yet rewarding market segment.