In focus
[ FUND ]
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This growth-focused fund is in the top quartile of its sector over one,
three, five and 10 years
Baillie Gifford
European
FE TRUSTNET
It is made up of between 40 and
80 stocks and aims for portfolio
turnover of less than 20 per cent.
As a growth fund, it has a low
exposure to financials and miners,
but is overweight industrials,
consumer goods and healthcare.
FACT BOX
MANAGERS: Stephen Paice, Moritz Sitte and Tom Walsh / LAUNCHED: 06/01/2000 /
FUND SIZE: £473.5m / OCF: 0.59%
FE CROWN RATING
PERFORMANCE OF FUND VS SECTOR AND INDEX
OVER MANAGER TENURE
Baillie Gifford MSCI Europe ex IA Europe ex UK
European (138.15%) UK (71.01%) (82.39%)
150%
125%
100%
75%
50%
25%
0%
r1
-25%
the region consists of under pressure
banks, disrupted automakers and
maligned miners. One option then to
play this market is to use a fund focused
on growth but in an area of the market
that is undervalued relative to the US.
One option for investors who are
thinking of using this strategy is the
five FE Crown-rated Baillie Gifford
European fund, run by Stephen Paice,
Moritz Sitte and Tom Walsh.
Premier Asset Management’s Simon
Evan-Cook recently described Baillie
Gifford as “like a stick of rock”,
adding: “Growth goes all the way
through them and you know that over
a 10-year period they are still going to
be here and running a growth style.”
The fund certainly looks as if it has
made the most of the bull run and is
in the top quartile of its sector over
one, three, five and 10 years.
It has made 138.15 per cent since
Paice – the longest serving of the
three managers – joined in April 2011,
A
fter what looked to be
a breakout period for
European investors last year,
the shine seems to have come off the
market in 2018.
While the MSCI Europe ex UK index
is in positive territory for the year, up
1.27 per cent, it is a long way behind
the 14.2 per cent gains of the S&P 500.
This is not a flash in the pan,
either, with the European index
underperforming its US counterpart
by 186.55 percentage points over the
past decade.
The flipside to this is that with the
European market further behind in
the economic cycle than the US, it
may not have as far to fall in the next
correction, and it could also be well
placed if value makes the comeback
so many investors have been waiting
for over the past decade.
However, while Europe may look
attractive from a valuation point of
view, much of the value “bucket” in
making it the third best-performing
trust in the sector over this time.
Baillie Gifford European aims to
invest for the long term in fast-growing
companies that typically have a strong
competitive position or an owner-
orientated management team.
Source: FE Analytics
trustnet.com