Dominated by women, tech-heavy fund is up 36% on the year

Seattle-based Zevenbergen Genea observes what products consumers are gravitating to when picking stocks

Jul 6, 2017 @ 1:49 pm

By John Waggoner

Zevenbergen Genea doesn't exactly roll off the tongue. But so far, the $5.7 million fund is on a roll.

The fund, which trades under the ticker ZVGNX, is a concentrated, go-anywhere fund that is largely focused in technology. So far this year, it's up 35.9%, versus 11.9% for the Standard & Poor's 500 stock index. The fund has soared 20.3% since its August 31, 2015 launch, versus 13.9% for the S&P 500.

One other thing stands out about the tech-heavy growth fund: Three of its five-person management team including the management company's founder, Nancy Zevenbergen, are women. Ms. Zevenbergen started Seattle-based Zevenbergen Capital Management in 1987. It now has $2.5 billion in assets.

It's unusual for women to dominate in either asset management or technology, yet at Zevenbergen Capital Management, it's the norm. Ms. Zevenbergen added two other women to the team: Brooke de Boutray, in 1992, and Leslie Tubbs in 1994. Joseph Dennison came on in 2009 and another co-manager, Anthony Zackery, started in 2011.

"Between the five of us on the team, we see a lot of things in different ways," Mr. Dennison said. "We all share one table, we sit together, we spend a lot of time bouncing ideas off each other."

Their goal: "We look for long-term, high-growth companies with managers who are visionary entrepreneurs," said Mr. Dennison. But how can you tell a Jeff Bezos from a Joe Btfsplk, the luckless cartoon character who always had a storm cloud over his head?

Zevenbergen management wants stocks of companies run by their founders — and those founders must be able to articulate their vision for the long term, be invested in the company's stock, and unafraid to make decisions, Mr. Dennison said. Those broad outlines have led the fund to companies like Amazon (AMZN), the fund's top holding, which dominates the online retail sector, and Tesla (TSLA), the fund's second-largest holding, whose early innovation in electric cars has given the company commanding growth in the auto sector.

It has also led it away from companies with hot new hardware, such as GoPro. "It's hard if you have a product that can be commoditized," Mr. Dennison said.

Clearly, management isn't the only thing that leads Zevenbergen Genea to new stocks. Balance sheets and filings are important. And so is simple observation. "It's amazing where you can find new ideas," Mr. Dennison said. "We're fortunate to be in Seattle, where lots of people are early adapters. It's hard to undervalue the importance of watching what people are actually using. A lot of companies have a steep inflection in their growth, and we want to be early on that curve."

The Zevenbergen Genea fund isn't for the faint of heart. It has 23 holdings, and Amazon, Tesla and Netflix (NFLX) accounted for 26.3% of its portfolio as of the end of March, according to Morningstar. The fund has 40% of its assets in tech and 47% in consumer cyclical stocks, with nothing in healthcare, utilities, energy or communications services.

A more diversified offering, Zevenbergen Growth (ZVNBX), has 40 holdings, and made its debut at the same time as Zevenbergen Genea. It's up 24.9% this year, according to Morningstar.

For a look at how Zevenbergen Capital runs money over the long term, look at RidgeWorth Innovative Growth Stock Fund (SAGAX), which has gained 8.6% a year the past 10 years, vs. 7.1% for the S&P 500. That outperformance comes with risk: The fund's 10-year standard deviation clocks in at 21.6, vs. 15.2 for the S&P 500, according to Morningstar. But at least by modern portfolio statistics, the returns have outweighed the risks: The fund carries a Sharpe ratio of 0.48 and a 1.04 alpha.


What do you think?

View comments

Recommended for you

Sponsored financial news

Upcoming Event

Apr 30


Retirement Income Summit

Join InvestmentNews at the 12th annual Retirement Income Summit - the industry's premier retirement planning conference.Much has changed - and much remains to be learned. Attend and discuss how the future is full of opportunity for ... Learn more

Featured video


When can advisers expect an SEC fiduciary rule proposal and other regs this year?

Managing editor Christina Nelson and senior reporter Mark Schoeff Jr. discuss regulations of consequence to financial advisers in 2018, and their likely timing.

Recommended Video

Path to growth

Latest news & opinion

Cutting through the red tape of adviser regulation is tricky

Don't expect a simple rollback of rules under the Trump administration in 2018 — instead, regulators are on pace to bolster financial adviser oversight.

Bond investors have more to worry about than a government shutdown

Inflation worries, international rates pushing Treasuries yields higher.

State measures to prevent elder financial abuse gaining steam

A growing number of states are looking to pass rules preventing exploitation of seniors.

Morgan Stanley reports a loss of advisers after exiting the protocol for broker recruiting

The firm said it lost 47 brokers in the fourth quarter, the most in any quarter of 2017.

Morgan Stanley's wealth management fees climb to all-time high

Improvement reflect firm's shift of more clients into fee-based accounts priced on asset levels, which boosts results as markets rise.


Hi! Glad you're here and we hope you like all the great work we do here at InvestmentNews. But what we do is expensive and is funded in part by our sponsors. So won't you show our sponsors a little love by whitelisting It'll help us continue to serve you.

Yes, show me how to whitelist

Ad blocker detected. Please whitelist us or give premium a try.


Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print