Baron Emerging Markets Fund retreated 1.26% (Institutional Shares) in Q4 2025, underperforming its benchmark, the MSCI Emerging Markets Index.
The fund, in its Q4 shareholder letter, stated that Taiwan Semiconductor Manufacturing Company (TSM), SK Hynix (HXSC.F), and Samsung Electronics (SSNLF) were the top contributors, while Alibaba Group, Kaynes Technology India, and Tencent (TCEHY) were the top detractors.
During Q4 2025, the fund initiated positions in Absa Group Limited (AGRPY) and FirstRand Limited (FANDY) as it believes South African banks are at the cusp of a favorable banking cycle.
The fund also re-established a position in Nu Holdings (NU) as it sees the leading digital bank in Latin America emerging from a benign credit cycle with its long-term competitive advantages intact and its growth opportunities enhanced.
According to its shareholder letter, the fund strengthened its positions in Alibaba Group (BABA) (BABAF), Samsung Electronics (SSNLF), Kuaishou Technology (KUASF), HDFC Bank (HDB), Bharat Electronics, Tata Communications, and InPost S.A. (INPOY).
During the quarter, Baron Emerging Markets Fund exited positions in Gold Fields Limited (GFI), KE Holdings Inc. (BEKE), and Dino Polska S.A. (DNOPY) due to high valuation and/or uncertainties over the earnings growth or competitive positioning going forward.
Source: Q4 shareholders letter