Baillie Gifford dominates league table of Scottish fund managers

Baillie Gifford dominates league table of Scottish fund managers

EDINBURGH fund house Baillie Gifford dominated The Herald’s league table of Scottish fund managers in October, taking 12 of the 20 spots for the second month running.

Mike Gush, who runs the firm’s Emerging Markets Growth Fund and Greater China Fund, was the highest placed overall after ranking at position 308 in in financial information group Citywire’s listing of nearly 4,000 global managers.

The table is based on risk-adjusted performance over the three years to the end of October.

Richard Sneller, who co-manages the Baillie Gifford Emerging Markets Growth Fund with Mr Gush, was a new entrant into the table in October, having moved up the global ranking from position 2,015 to 1,264.

The fund, which has outperformed the MSCI Emerging Markets Index over the past three years, has 34 per cent of its assets Invested in China and also has large positions in India and South Korea.

Its largest stock weightings are Chinese technology company Tencent, South Korea’s Samsung Electronics, which both account for 6.3 per cent of the fund.

While most of the Baillie Gifford managers moved up the table month on month, Stephen Paice and Moritz Sitte, who together run the fund house’s European Fund, slid down.

The managers say their Investment philosophy is to “own a portfolio of durable, growing, well-managed businesses which can survive downturns without undue distress and are able to expand profitably in the upswings”.

“In addition, we try to buy them when their strengths are not recognised by the Market,” they added.

“We make no attempt to predict economic or political developments or to respond to short-term share price movements.

“Our purchase of Zooplus, an online petfood retailer managed by its entrepreneurial founder, is a good example of this.

“Its ability to amaze customers and take Market share from structurally disadvantaged competitors is far more important that the noise of what may or may not happen to the eurozone economy.”

On a country basis, the fund’s largest positions are in Sweden, Germany and Switzerland, with the fund typically holding between 40 and 80 stocks.

At the end of October its largest individual holding was Swedish industrial company Atlas Copco, which accounted for four per cent of the total.

Irish airline Ryanair was the second largest holding at 3.9 per cent followed by Swedish bank Svenska Handelsbanken at 3.2 per cent.

“We remain confident in the merits of our Investment approach and of the businesses we own, and believe that by adhering to our philosophy in a disciplined manner we should deliver good long-term performance for our clients over multiple business and stock Market cycles,” the managers said.

“European stock Markets remain a fertile hunting ground for our style of Investment, and we are optimistic about the future long-term returns of the Fund.”

The other Baillie Gifford managers in the Scottish table in October included Iain McCombie, who runs the Managed Fund, and Mark Urquhart, manager of the Baillie Gifford Long Term Global Growth Fund.

The number of Baillie Gifford managers to make it into the Scottish top 20 has grown steadily over the course of this year.

In June six managers were on the list, with the number rising to eight in August, nine in September and 12 in October.

The top end of the table continues to be dominated by Amati’s Paul Jourdan, David Stevenson and Douglas Lawson, who collectively manage the Amati UK Smaller Companies Fund.

While the AAA-rated managers have not moved from their number one slot in the Scottish table they have moved up the global one, rising from position 51 in September to 28 in October.

Standard Life’s Harry Nimmo, who runs the group’s UK Smaller Companies Fund, ranked behind the Amati managers after gaining more than 200 places in the global table.

Having ranked in position 476 overall in September, AAA-rated Mr Nimmo, who takes a long-term approach when buying into companies, had climbed to position 251 in October.


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