Baron Risk Optimized Large Cap ETF

Alphabet Inc. (GOOGL) is the parent of Google, the world's most dominant online search provider. Other services and products include display advertising, Android, Chrome, Google Cloud, Google Maps, Google Play, and YouTube. Its Other Bets segment consists of businesses such as Waymo, CapitalG, and Verily.
Alphabet is the largest beneficiary of the secular shift in advertising from traditional media to online and mobile platforms. The company has processed and indexed more data than any other firm, leveraging its extensive datasets to improve products and expand into adjacent markets. Alphabet’s scale, distribution, and talent position it to benefit from AI in both its core and cloud services businesses. YouTube provides exposure to the transition toward connected TV, while Waymo remains a leader in autonomous driving.

NVIDIA Corporation (NVDA) sells semiconductors, systems, and software for accelerated computing, gaming, and generative AI.
Computing demand has been doubling every one to two years, driven by electrification, digitization, and recent advancements in AI, yet supply growth has decelerated dramatically due to the slowdown in Moore's law. NVIDIA’s accelerated computing architecture enables continued growth in computing capacity through parallelization. We are at the tipping point of a new era in computing, with NVIDIA at its epicenter as generative AI adoption grows. With leading market share in gaming, data centers, and autonomous machines, we think NVIDIA is well positioned for long-term growth.

Amazon.com, Inc. (AMZN) is an e-commerce pioneer, innovator, and market share leader with a relentless focus on providing value and convenience to its customers. Amazon also operates the industry-leading cloud infrastructure business Amazon Web Services (AWS). 
Amazon's market share of U.S. online retail sales is around 40%, while its share of global retail sales is less than 5%. Amazon has many avenues for revenue growth, including consumer staples, international expansion, grocery, digital media offerings, private label, pharmacy and health care services, advertising, and a better shopping experience powered by generative AI. Amazon also represents an opportunity to invest in the secular growth of cloud computing and the adoption of enterprise AI through AWS — a large, fast-growing, and margin-accretive part of the business. 

Apple Inc. (AAPL) designs, manufactures, and markets consumer electronics, computer software, and online services. Its products include the iPhone, iPad, Mac personal computer, Apple smartwatch, Apple TV, and HomePod. The company also offers advertising and app discovery services through its App Store.
As the creator and owner of one of the largest and most popular consumer electronics platforms, Apple, in our view, is well positioned to benefit from the network effect that typically accrues to platform companies. It has a large and growing ecosystem, a trusted brand, and positive optionality through leveraging its large installed base to expand into additional consumer and enterprise services. We believe Apple trades at a discount to our estimate of its intrinsic value, with capital return and growth alleviating near-term trade and iPhone demand uncertainty.

Costco Wholesale Corporation (COST) operates over 900 membership-based warehouse clubs globally. The company offers a broad assortment of branded and private label merchandise, including its Kirkland Signature line, primarily in large-format packaging designed to deliver compelling value to members.
Costco is a unique retailer with a defensible business model supported by its membership structure and best-in-class low-cost operations. The company's low prices (20% to 50% below competitors), high-quality products (including Kirkland Signature), and distinctive “treasure hunt” shopping experience foster strong customer loyalty among its more than 145 million cardholders. Costco has proven resilient during economic downturns due to its strong value proposition and generates robust free cash flow, which it returns to shareholders through dividends and share repurchases.

Broadcom Inc. (AVGO) designs, develops, and supplies a wide range of semiconductor and infrastructure software solutions. Its semiconductor devices serve broadband, networking, wireless, storage, and industrial markets, while its software offerings focus on operational efficiency tools for large enterprises.
Broadcom’s semiconductor portfolio is reaching an inflection point, driven by its AI solutions in networking and custom compute. We expect Broadcom to capture a significant share of most of the custom AI chips market, a market opportunity of hundreds of billions, and to grow VMware at a high-teens rate over the next few years. The rest of Broadcom’s semiconductor business is recovering, and we expect other software segments to grow at a mid-single-digit rate. The company has best-in-class margins and cash flow, which it returns to shareholders.

Spotify Technology S.A. (SPOT) is the world's leading music streaming service, with approximately 40% market share. The company monetizes through several tiers of subscriptions, advertising, and miscellaneous a la carte pricing. 
With over 290 million paying subscribers, Spotify has created a two-sided marketplace where creators can monetize their work and consumers can stream music. Longer term, we expect the company to grow to over 1 billion subscribers (from 751 million today) and improve margins materially through advertising, its artist promotions marketplace, audiobooks, and improved cost discipline. We expect Spotify to continually improve its value proposition through additional features like video, and monetize this value through more optimized pricing tiers like Super Premium.

Bank of America Corporation

Eli Lilly and Company (LLY) is a multinational pharmaceutical company developing drugs in diabetes, oncology, immunology, and neuroscience. The company's top-selling drugs include Mounjaro, Zepbound, Trulicity, Humalog, Alimta, Taltz, Humulin, and Jardiance.
We are investors in Lilly given its focus on industry-leading growth categories like diabetes, obesity, and oncology. Leading GLP-1 drugs Mounjaro and Zepbound offer superb blood sugar control for diabetics, can drive 20%-plus weight loss in obese patients, and are likely improve cardiovascular outcomes in both diabetic and non-diabetic obese patients. We think GLP-1 drugs will become the standard of care for both diabetes and obesity, representing a $150 billion-plus market. We believe Lilly has the potential to double revenues and achieve double-digit EPS growth by 2030.

Welltower Inc. (WELL) is a $70 billion diversified health care owner and manager of senior housing, including assisted and independent living. Core to its strategy is to partner with top-tier operators and health systems while providing operators access to its proprietary data analytics platform.
We are optimistic about the prospects for Welltower given the substantial opportunity for cyclical recovery and continued secular growth in its senior housing business through occupancy and rent growth. The company also benefits from its proven ability to recycle capital at attractive rates of returns, premier health care platform, partnerships with top-tier operators, and well-respected management team focused solely on creating value on a per-share basis.

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