Overview of Baillie Gifford
Colin Neilson, Director, provides an overview of Baillie Gifford.
Baillie Gifford is an independent investment manager with a distinctive investment philosophy and a long history of delivering strong results. They specialise in investing in global companies with the potential to grow to many times their current size.
As such, when they describe their investment approach as long term, they really mean it – in fact, they think it’s easier in many ways to predict what will happen over ten years rather than two. Baillie Gifford never invests in a business because of what it is today, but because of what it has the potential to become.
Founded in 1908 and based in Edinburgh, Baillie Gifford is wholly owned by 43 partners, who all work within the company. This unique business model, with no short-term demands from external stakeholders, means the team can focus on what it does best – seeking out long-term investment returns for their clients.
Colonial First State’s partnership with Baillie Gifford gives Australian retail investors the chance to invest in a portfolio of exceptional companies from around the globe that have the potential to achieve growth over the long term. Baillie Gifford has over AUD$470 billion in assets under management as at 30 June 2020.
Willingness to maintain a true long-term view in an increasingly impatient industry.
Big societal changes are far more important in the long run than the small print in profit and loss accounts.
Baillie Gifford’s belief is that sustained growth in company profits leads to higher share prices over time. Their rigorous process of fundamental analysis and proprietary research, combined with a depth of expertise, are core to a successful, long-term, bottom-up investment approach.
The Baillie Gifford team are, in their words, ‘curious about the world’. They believe that the best investment ideas spring from thinking about future possibilities, not short-term probabilities. Their research process seeks to understand new technologies and the nature of disruption, an approach that sees them spending more time talking to academics and scientists than to brokers and analysts.
ACTUAL INVESTING, NOT ACTIVE INVESTING
Baillie Gifford describes what they do as being more than generically active investing: they prefer to call it ‘actual investing’.
Their investment philosophy is based on three key principles:
A high-conviction global share fund that focuses on investing in exceptional companies from around the globe with the potential to achieve market-defying growth over the long term.
A concentrated global portfolio that combines the best elements of stewardship and specialist regional expertise to invest in growth businesses.
In an industry whose priorities are increasingly out of kilter, the real business of investing should be less about capital market theory and stock market analysis and more about finding great ideas and putting real money into real projects, as Baillie Gifford partner Stuart Dunbar explains in this thought-provoking interview.
Technological developments over recent decades mean reality has outpaced the science fiction of his youth since Mark Urquhart joined Ballie Gifford almost 25 years ago. Now, scanning the Coronavirus driven global economy, he sets out his enthusiasm and expectations for the next decade and beyond.
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