September 28, 2020 BARRON’S 29
FUND PROFILE
Talking With George Dai and Josh Bennett
Co-Managers, Alger Weatherbie Specialized Growth
Checking
The Boxes
For Quality
Photograph byCODY O’LOUGHLIN
I
n late January, George Dai warned his colleagues
at Weatherbie Capital that updates from family,
friends, and social media in China indicated that
the coronavirus—and its economic impact—were
far more serious than the prevailing view.
“We decided to take two defensive steps,” says
Dai, who grew up in China and moved to the U.S.
in 1988 to get a Ph.D. in chemistry from Johns Hopkins
University.
First, his team cut their exposure to companies
whose revenue or supply chains had close ties to China.
Then the group of six managers and analysts went
through all 50 holdings in the $883 million Alger
Weatherbie Specialized Growth fund (ticker: AL-
MAX) to reassess each company’s financial wherewithal
and upgrade the portfolio accordingly.
As a result, the fund held up far better than its mid-
cap growth peers and its benchmark during the first
quarter. This positioning, coupled with the Boston-
based firm’s philosophy of combining high-quality
“foundation” stocks with a smattering of “opportunity”
names, has helped deliver average annual returns of
20.1% over the past three years, better than 87% of its
peers. The flagship fund opened its doors to retail inves-
tors in 2017, when the firm became a wholly owned sub-
sidiary of Alger Associates. But the strategy’s record
extends to 1996, over which time it has returned an av-
erage of nearly 11.8% annually, net of fees.
Investors today are grappling with a great deal of
uncertainty, but “our outlook is cautiously optimistic,”
particularly with a vaccine potentially just months away,
says Dai, 54. Global central banks’ accommodative poli-
cies and an improving U.S. economy are also reasons to
be upbeat, “especially when it comes to smaller compa-
nies,” adds Josh Bennett, Dai’s co-manager and
Weatherbie’s director of research. “That’s where the
By SARAH MAX
George Dai, left, and Josh Bennett
co-manage the Alger Weatherbie
Specialized Growth fund.