The trust’s benchmark returned 3% a year in the 2000s and 8.6% in the 2010s, so Scottish Mortgage maintained a slender lead during Anderson’s first decade before racing ahead in the second. The resolutely global approach taken by the trust is reflected in the current investment themes such as the speed of technological advances and how they can disrupt established business practices, and the re-emergence of China as an economic superpower. The Trust’s risk could be increased as these assets may be more difficult to sell, so changes in their prices may be greater. We do not provide personal advice neither will we arrange any product on your behalf. This increases the risk of the fund as well as its potential return. Past performance is not a guide to future performance. Then his winning streak came to an end and his returns never had anything close to such a winning streak again. There was an error loading data, please try again. We can see the result of gearing, and the high risk nature of Scottish Mortgage Investment Trust's investments if we plot the fund daily returns versus those of its benchmark which is the FTSE All World Index in sterling. He was appointed a Director in 2016. Not only is Scottish Mortgage currently the biggest UK-listed investment trust with a market cap of over £10 billion, but it’s also been one of the best performers over the last few decades. I guess we all have a line somewhere in the sand that cannot be crossed! Unlisted companies have less transparency and require more research. The maximum amount which may be invested in companies not listed on a public market shall not exceed 30 per cent of the total assets of the Company, measured at the time of purchase. Nothing on this website should be regarded as a buy or sell recommendation as I'm just a random person writing a blog in his spare time and I am not authorised to give financial advice. Martin Currie Global Portfolio: A Little-Known Gem? You should be aware of the following risks when considering investing. An authorised intermediary can give you advice and help on how best to manage your financial affairs based on your circumstances and investment aspirations. There are also some relatively disappointing results, for example Home24 (online furniture sales), HelloFresh (meal kits) and Unity Biotechnology (develops medicines that potentially halt, slow or reverse age-associated diseases). Stocks listed on overseas exchanges may be subject to additional dealing and exchange rate charges, administrative costs, withholding taxes, different accounting and reporting standards, may have other tax implications, and may not provide the same, or any, regulatory protection. Scottish Mortgage’s website and annual reports are well worth a read to get a fuller flavour of its investing style. Required fields are marked *, Copyright © 2018-2020 www.itinvestor.co.uk. 25 June 2020, Baillie Gifford offices, Edinburgh. Scottish Mortgage RNS Announcement Interim Report - 30 September 2020, Scottish Mortgage Annual Report - including the Notice of AGM - March 2020, Scottish Mortgage Corporate Calendar, AGM Voting and Attendance, London Stock Exchange - Scottish Mortgage Announcements, Scottish Mortgage Annual Report - including the Notice of AGM - March 2019, Scottish Mortgage Annual Report - including the Notice of AGM - March 2018, Scottish Mortgage Annual Report - March 2017, Scottish Mortgage Annual Report - March 2016, Scottish Mortgage Notice of AGM incl. However, given the strong growth in the sector, I’d expect technology stocks to continue rising sooner or later. Monks Investment Trust: With Change Comes Opportunity, https://www.trustintelligence.co.uk/investor/articles/riding-for-a-fall-retail-may-2020#, International Biotechnology Trust: Bypassing Binary Bets. You should not invest any money you can’t afford to lose and should not rely on any dividend income to meet your living expenses. 2 UK shares I’d buy for 2021 in an ISA to retire in comfort, Has the new bull market begun? Reliance should not be placed on the views and information in this document when taking individual investment and/or strategic decisions. James Anderson and Tom Slater can draw on the expertise of the Long Term Global Growth team, which has considerable resources. Another source of increased risk is that the fund buys unlisted companies. This website is informative only and the information provided should not be considered as investment or other advice or a recommendation to buy, sell or hold a particular investment. Another manifestation of the increased risk of the fund is its high typical daily percentage price movement, or volatility. For example, this chart shows how the proportion of unlisted investments has increased in recent years. The fund usually keeps the level of borrowing between 10% and 20%. Investment is predominantly in equities. The continual rise and development of China, in particular of its world leading digital economy. Kepler did a note this week looking at this very thing… https://www.trustintelligence.co.uk/investor/articles/riding-for-a-fall-retail-may-2020#, Your email address will not be published. Scottish Mortgage Investment Trust is popular because it has performed extremely well for the last decade. If you are in any doubt about the information on this website please consult your financial or other professional adviser. This means they try to identify companies which can grow their earnings rapidly. The trust aims to outperform world stock market indices over a five-year rolling period. Check out our top picks for the best share dealing brokers. However, I said that it wasn’t too late to invest. Scottish Mortgage is also one of the old guard of the investment trust sector, having been launched in 1909 as Straits Mortgage and Trust Company. You must be a registered user to save alerts. The company claims that it will bring down the price of sequencing a person's entire genome to $100. It moved to a small premium in 2014/5, as folks began to take heed of its strong outperformance, and it’s remained at a premium of a few per cent pretty much ever since. The large position in Tesla is also worth mentioning. FTSE Russell is a trading name of certain of the LSE Group companies. If you require any personal advice or personal recommendation, please speak to an independent qualified financial adviser. For example, in 2008 when its benchmark fell by -22% the fund fell twice as much, by -45%. Baillie Gifford is clearly very proud of its Scottish heritage. James Anderson, joint manager of Scottish Mortgage Investment Trust, looks back on how, amid all the coronavirus disruption, the case for growth stocks strengthened as the crisis unfolded. If you continue to use this site we will assume that you are happy with it. The Trust has a significant investment in private companies. Other unlisted investments that floated, and so make up the difference between the blue and yellow lines in the chart above, include Spotify, Meituan, Anaplan, Vir, and Slack. Exchange rate charges may adversely affect the value of shares in sterling terms, and you could lose money in sterling even if the stock rises in the currency of origin. A Top Share with Enormous Growth Potential, Savvy investors like you won’t want to miss out on this timely opportunity…. Information on the range of funds available through platforms can be found in our Platform Matrix. It had nearly £2 billion in assets back in 1999 whereas many of the other trusts listed above were smaller and therefore much more nimble with heavily concentrated portfolios. © 2017 Morningstar. The main difference between the ongoing charge figure and the cost figure in the Key Information Document relates to 0.4% for borrowing costs. Like other popular and successful active funds in the UK Scottish Mortgage Investment Trust concentrates its portfolio in a small number of companies. I suspect Scottish Mortgage might start selling down its position a little, as it has done in the past with Amazon, should Tesla’s share price climb much further. The difference of 11% was due to borrowing of £753 million. Prior to this, he headed our European Equity Team. He chaired Baillie Gifford’s International Growth Portfolio Group from its inception in 2003 until July 2019. For example Bill Miller, a fund manager based in the US, beat the S&P 500 for 15 years in succession from 1991 to 2005. Great article and a well run fund, its just a little late in the cycle for my tastes. It had assets of £500 million even then. Exchange rate fluctuations can reduce the sterling value of any overseas holdings. Today however, it’s near 1,020p. “FTSE®" and “Russell®” are trade marks of the relevant LSE Group companies and are used by any other LSE Group company under license. Stocks are carefully selected for their strong growth prospects. Image source: Getty Images. However, it’s far smaller, with a market cap of £240m, and its wildly oscillating premium to net assets can be rather unnerving. This is done by building several models of the future cash flows for a company, then working out the present value of those cash flows and comparing it with the share price of the company. Scottish Mortgage Investment Trust invested had 35 unlisted investments in 2018, which means unlisted investments accounted for 17% of the fund's total assets. Tesla has been in Scottish Mortgage’s top ten holdings for a while now and it became its second-largest holding in 2017. The latest fund information for Scottish Mortgage Investment Trust PLC, including fund prices, fund performance, ratings, analysis, asset allocation, ratios & fund manager information. Anderson goes on to say: The trends that the fund has identified and which, if they continue, will buoy up the fund returns are: This is a high risk fund and so investors should be willing to hold it for a very long period of time, preferably decades, to get the maximum benefit from its investment approach. For example Lindsell Train charges 0.74% (or 0.54% if you hold it on the otherwise pricey Hargreaves Lansdown platform), and Terry Smith's Fundsmith Global Equity fund is 0.95%. Good governance given the oversight by a highly skilled board of directors, Transparency, with excellent videos and regular reports explaining the investment approach, Consistent and skilled management from James Anderson and Tom Slater. Justin Dowley is a former international investment banker and was appointed a Director in 2015. This little-known State Pension rule change could halve your retirement income overnight, 4 things within your control that can make or break your retirement dreams, Free Report: 5 Stocks For Trying To Build Wealth After 50, No savings at 40? Most of Baillie Gifford’s growth has been organic, rather than acquiring other fund management businesses. So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Its returns have been very good for the last decade and on the back of its performance it has single-handedly made investment trusts sexy again. Fiona was appointed a Director in 2009 and became Chair in 2017. Tom Slater, the other joint manager, has been with Baillie Gifford since leaving university in 2000, so is probably in his early 40s. Also, by not being accountable to shareholder scrutiny of quarterly accounts the management of the company can focus on long-term growth.
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