The Columbia Global Technology Growth Fund Institutional Class experienced a challenging first quarter of 2025, with shares returning -12.26% for the period ending March 31st. This commentary provides a detailed analysis of the factors contributing to this performance, including broader market trends, sector-specific headwinds, and portfolio positioning.

Navigating a Volatile Tech Landscape

Q1 2025 presented a unique set of challenges for technology investors. Rising interest rates, persistent inflation concerns, and ongoing geopolitical uncertainties created a climate of heightened volatility. While the technology sector has historically demonstrated resilience, these macroeconomic pressures significantly impacted growth stock valuations across the board. We observed a particularly strong reaction in areas sensitive to rate hikes and economic slowdowns.

Key Performance Drivers

Several key factors contributed to the Fund’s negative performance. Firstly, a rotation out of high-growth technology names favored value stocks, impacting the Fund’s overweight position in many rapidly expanding companies. Secondly, specific regulatory concerns surrounding a few key holdings created downward pressure. Thirdly, despite positive underlying business trends, some portfolio companies faced temporary headwinds related to supply chain disruptions and increased operating costs.

Portfolio Strategy and Adjustments

Throughout Q1, the investment team actively managed the portfolio to mitigate risk and capitalize on emerging opportunities. We selectively trimmed positions in companies facing the most significant challenges and increased exposure to businesses demonstrating strong fundamentals and sustainable competitive advantages. We remain focused on identifying companies with robust balance sheets, innovative technologies, and proven management teams. This includes a continued emphasis on areas like artificial intelligence, cybersecurity, and cloud computing, which we believe will drive long-term growth.

Looking Ahead: Opportunities and Challenges

While the near-term outlook remains uncertain, we believe the long-term growth prospects for the technology sector remain compelling. We anticipate continued innovation and disruption across various industries, fueled by advancements in emerging technologies. However, we acknowledge that navigating the current environment will require a disciplined and selective approach. We are closely monitoring economic data, regulatory developments, and technological advancements to inform our investment decisions.

Important Note: This commentary is for informational purposes only and should not be considered investment advice. Past performance is not indicative of future results. Please read the Fund’s prospectus carefully before investing.