Baillie Gifford funds end year with a bang
Saltydog Investor reviews the funds finishing the year strongly, including Baillie Gifford strategies.
24th December 2024 08:36
by Douglas Chadwick from ii contributor
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Although it fell sharply last week, Baillie Gifford American is still the best-performing fund so far in the fourth quarter of 2024.
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Saltydog Investor’s top 10 funds in Q4
| Name | Investment Association (IA) sector | Oct | Nov | 1 Dec to 22 Dec | 1 Oct to 22 Dec |
| Baillie Gifford American | North America | 5.9 | 14.9 | -0.1 | 21.0 |
| TM Natixis Loomis Sayles US Eq Leaders | North America | 5.1 | 8.2 | 2.8 | 17.3 |
| Jupiter Global Financial Innovation | Financials & Financial Innovation | 7.9 | 9.0 | -2.9 | 13.5 |
| Baillie Gifford L/T Global Growth | Global | 4.5 | 9.0 | 0.0 | 13.3 |
| Janus Henderson Global Financials I Acc | Financials & Financial Innovation | 7.7 | 8.4 | -2.9 | 13.2 |
| Liontrust Global Technology | Technology & Technology Innovation | 6.3 | 3.7 | 4.0 | 12.9 |
| abrdn American Equity | North America | 5.5 | 6.1 | 1.1 | 12.9 |
| AXA Framlington American Growth | North America | 5.7 | 7.7 | -0.6 | 12.5 |
| UBS US Growth C Acc | North America | 5.4 | 5.6 | 1.9 | 12.3 |
| T. Rowe Price US Large Cap Growth Equity | North America | 5.5 | 7.6 | -0.7 | 12.2 |
Data source: Morningstar. Past performance is not a guide to future performance.
The leading sector since the end of October is actually Technology & Technology Innovation, but as we have seen before, when the technology sector does well, so do certain funds in the North America and Global sectors. These funds are often investing in many of the same companies.
The Baillie Gifford American fund, at the top of the table, has risen by 21% in less than three months, and so far this year has made a gain of nearly 33%. Although it is in the North America sector, its top 10 holdings include Amazon.com Inc (NASDAQ:AMZN), Meta Platforms Inc Class A (NASDAQ:META), NVIDIA Corp (NASDAQ:NVDA), Netflix Inc (NASDAQ:NFLX), and Tesla Inc (NASDAQ:TSLA) – companies that you would expect to find in many funds from the Technology & Technology Innovation sector.
Fourth in our list of leading funds is another Baillie Gifford fund, Long-Term Global Growth. It is in the Global sector, but also has a bias towards technology companies. As well as holding the large US technology companies, similar to the Baillie Gifford America fund, it also invests in businesses such as Meituan Class B (SEHK:3690) and PDD Holdings Inc ADR (NASDAQ:PDD), from China, and ASML Holding NV (EURONEXT:ASML), from the Netherlands.
Baillie Gifford is an independent investment manager founded in Edinburgh more than 100 years ago. They now manage 31 UK open-ended investment companies and 12 investment trusts. While their funds cover many sectors of the market, their core philosophy is to provide long-term growth by investing in companies that drive change.
They say: “We don’t speculate on short-term shifts in financial markets or try to out-guess macroeconomic forecasters. Instead, our investment teams engage in deep, bottom-up analysis of companies. We try to find those that are disrupting existing ways of doing things. And we look for those with a deep-seated competitive advantage so they aren’t dependent on external factors they can’t control.”
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Two Baillie Gifford investment trusts also caught our eye in recent weeks. Their flagship investment trust, Scottish Mortgage, is one of the UK's largest and most prominent investment trusts, focusing on long-term growth through investments in innovative and high-growth companies around the world.
Scottish Mortgage Ord (LSE:SMT) is known for its emphasis on disruptive technologies and its willingness to take significant stakes in private, as well as public companies. In our latest reports, it was showing a four-week gain of 5.4% and a 12-week return of 19.4%.
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Their smaller Edinburgh Worldwide Ord (LSE:EWI) trust has done even better. Up 12.8% over four weeks, 28.6% over 12 weeks, and 36.2% over 26 weeks. There may also be the potential for a further major gain to be made. Edinburgh Worldwide’s largest investment is in SpaceX preference shares.
SpaceX is Elon Musk’s unlisted ‘Space Exploration Technologies’ company, which has already successfully taken astronauts to the International Space Station. Its subsidiary, Starlink, controls a large number of communication satellites orbiting the Earth, providing high-speed internet.
Musk has indicated that he might consider floating Starlink with an IPO. Should this happen, it will likely be for a gigantic sum, and those preference shares could also skyrocket.
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