Skip to main content
  • Register
  • Help
  • Contact us
  • Log out of your HL account
A A A

Baillie Gifford Managed - looking for fast-growing companies

Kate Marshall | Wed 23 May 2018

Investments can go down as well as up so there is always a danger that you could get back less than you invest. Nothing here is personalised advice, if unsure you should seek advice.
  • The team like companies that use technology to improve what they do
  • This focus has helped performance over the past year
  • We view the fund as a great choice to get diversified exposure to stock and bond markets

Our View

The Baillie Gifford Managed Fund invests in the management team's best share and bond ideas globally. We think it's a great choice for a ready-made, diversified fund.

The managers usually invest around three-quarters of the fund in shares. This has boosted long-term performance. The rest of the fund is invested in bonds and cash, which provides some stability when stock markets are volatile. It can still fall in value though, and past performance is not a guide to future returns.

We believe the experience of the team behind the fund is a real strength. We like their patient approach and the fact they've stuck to the same disciplined investment process through thick and thin. The fund deserves its place on the Wealth 150+ list of our favourite funds.

The technology revolution

The managers look for companies they think can survive over the long term. They like businesses that innovate and use technology to adapt to changing consumer tastes and demands.

Current investments include Amazon. It's well known as a place to buy a range of products. But it continues to innovate and expand into new areas, such as cloud computing and online grocery shopping. This could help the business become a key competitor in a lot of industries – something many other companies find hard to do.

This investment, along with some other North American technology companies, helped performance over the past year.

Other examples include online furniture retailer Wayfair. Its profits grew over the year and it announced it'll start to sell high-end furniture with a new brand. This is an area other online businesses have struggled to be successful in because of the demands of delivering large items. But Wayfair can use its existing distribution network to do this.

Investments in emerging markets increased over the year. Shares in TSMC, which is based in Taiwan and makes parts for electronic devices such as smartphones, and South Korean firm Samsung Electronics, were added to the fund. Investing in emerging markets can increase risk, as can the managers' ability to use derivatives.

Healthcare is another area where change and innovation is picking up. Healthcare companies only make up a small part of the fund at the moment, but the managers say this will increase. Illumina is a current investment. It makes gene sequencing machines, which look at how our DNA is made up. This could have a big impact on how diseases are diagnosed and medicines are developed.

Around 18% of the fund is invested in bonds. The managers prefer bonds issued by companies and emerging markets governments, rather than developed market governments. This helped performance over the past year as developed market government bonds were weaker.

Performance review

The fund's performance has been impressive over both the short and long term. It grew 136.5%* over the past ten years compared with 72.0% for the average fund in its sector, although this isn't a guide to future performance.

The managers mainly invest in businesses expected to grow faster, or at a steadier rate, than others. This investment style has worked well in recent years. But there will be times when other styles work better and this could impact the fund's performance. Over the longer term we still think investors will benefit from investing with such a robust team and a longstanding process.

Baillie Gifford Managed - ten year performance

Past performance is not a guide to the future. Source: *Lipper IM to 30/04/2018.

Annual percentage growth
Apr 2013 -
Apr 2014
Apr 2014 -
Apr 2015
Apr 2015 -
Apr 2016
Apr 2016 -
Apr 2017
Apr 2017 -
Apr 2018
Baillie Gifford Managed 4.9% 10.6% 0.7% 23.4% 8.7%
IA Mixed Investment 40-85% Shares 5.0% 10.5% -2.7% 17.2% 4.9%

Past performance is not a guide to the future. Source: Lipper IM to 30/04/2018.

This fund has a holding in Hargreaves Lansdown plc shares.

Please read the Key Features/ Key Investor Information in addition to the information above.

Find out more about this fund including charges

Important information - Please remember the value of investments, and any income from them, can fall as well as rise so you could get back less than you invest. This article is provided to help you make your own investment decisions, it is not advice. If you are unsure of the suitability of an investment for your circumstances please seek advice. No news or research item is a personal recommendation to deal.


You may also be interested in: