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Aristotle Small Cap Equity Fund posts 13.7% in Q2 2026
The fund lagged the Russell 2000, returning 13.7% versus the index’s 21.5% gain, as stock selection in information technology and industrials weighed on results.
Aristotle Capital Boston, LLC said its Aristotle Small Cap Equity Fund returned 13.69% in the second quarter of 2026, underperforming the Russell 2000 Index, which gained 21.49% over the same period, according to a Q2 2026 investor letter published via Yahoo Finance.
The letter attributed the relative shortfall to security selection in information technology and industrials, even as positive allocation effects helped performance. It also highlighted top contributors including MACOM Technology Solutions and Mercury Systems, which benefited from strong demand in semiconductor, aerospace, and defense markets.
Aristotle also named detractors, including Alamos Gold and Huron Consulting Group, citing operational challenges, weaker gold prices, and investor concerns related to artificial intelligence disruption. During the quarter, the fund initiated positions in IPG Photonics and UMB Financial, while exiting Americold Realty Trust, Byline Bancorp, and Verra Mobility.
Looking ahead, management said it remains constructive on U.S. small-cap equities, pointing to valuations that it considers attractive relative to large caps and expecting earnings growth to accelerate into late 2026 and 2027. It cited potential support from higher merger and acquisition activity, improving domestic manufacturing tied to reshoring and infrastructure investment, and a favorable regulatory environment.
Latest closeGold $4,432.00 ▲1.6%|Russell 2000 3,068.42 ▲0.5%