Fund Profile

Disclaimer

This is a non-independent marketing communication commissioned by Baillie Gifford. The report has not been prepared in accordance with legal requirements designed to promote the independence of investment research and is not subject to any prohibition on the dealing ahead of the dissemination of investment research.

Overview
Baillie Gifford US Growth (USA) launched in March of 2018, aiming to produce long-term capital growth through investing in listend and unlisted US equities...
Overview

Baillie Gifford US Growth (USA) launched in March of 2018, aiming to produce long-term capital growth through investing in US equities. Gary Robinson and Helen Xiong are at the helm of the portfolio, searching for exceptional growth companies, where their innovations are likely to offer significant contributions to society. The managers undertake rigorous bottom-up analysis to uncover information others might be missing, in particular looking for companies that exhibit high barriers to entry, a large market opportunity and a culture that is aligned with their end goals.

In order to fully expose investors to the highest growth opportunities, the managers also have latitude to invest in unlisted companies. In their view, the most compelling growth companies are choosing to stay private for longer, which they believe gives the trust a unique edge over its peers. On sectoral basis, the trust is dominated by the consumer discretionary (26%), information technology (19.6%) and health care (17%) sectors.

Since the launch of the trust, performance has seen its fair share of ups and downs. The first six months of the trust’s life saw NAV returns of over 30%, close to 10% greater than the S&P 500 and the AIC peer group, and close to 15% ahead of the IA peer group. However, the final four months of 2018 saw the trust lost close to 19%, considerably more than peers (-12.9%) and the benchmark (-11.4%). Since then, the trust has once more rebounded and over 2019 the trust has delivered 20.8% NAV returns, to the 6 May. This volatility is likely to continue, and with a down capture ratio of 128 (sector average of 85) and standard deviation of 30.6 (relative to the sector average of 19.9) the trust might not be for the faint hearted.

Currently, the trust is trading on a premium of 2.7%. This premium has been reasonably consistent throughout the 14-month life of the trust, reaching highs of over 10%, and only dipping to a discount a handful of times for very short periods. The company has been issuing shares over recent months to help grow the trust and make sure the premium does not expand too far.


Kepler View

USA has been formed with the intention to help investors access the most exciting new growth companies across the listed and unlisted space in the US market. It is now easier for these high growth start-up companies to obtain capital from numerous sources, and so do not need to list on a public exchange until a later part of their life. This means that investors have been missing out on potential returns for much of the current prolonged bull market. USA looks to change this.

The trust holds some exciting growth opportunities, and this has been reflected in the strong performance of the trust since inception. With this said, we have seen the volatility of the trust rear its ugly head, and figures like the beta of 1.3, the down capture ratio of 128 (sector average of 85.3) and standard deviation of 30.6 (relative to the sector average of 19.9) are in some ways quite alarming.

Currently trading on a premium of 2.7% and issuing shares, the trust is clearly in demand. However, should we see continued volatility in 2019, this could potentially throw up opportunities to enter the company on a discount.

Bull Bear
Offers unique exposure to both listed and unlisted opportunities Extremely volatile
Strong performance since inception Trading at a premium to NAV


Continue to Portfolio

Fund History

29 Apr 2022 Baillie Gifford US Growth Trust: The long view
The US is home to fast-growing, disruptive and culturally unique companies. Watch this recent webinar recording to hear from fund managers Gary Robinson and Kirsty Gibson as they discuss growth investing in the US and the businesses that are driving structural change across sectors worldwide...
19 Nov 2021 Seismic shifts
Companies and industries rarely evolve gradually. Progress is often explosive explains Kirsty Gibson, joint manager of the Baillie Gifford US Growth Trust
01 Oct 2021 Baillie Gifford US Growth Trust – Manager Insights
The ways we work, play, study, shop and seek healthcare have changed during the pandemic, prompting new investments by the Baillie Gifford US Growth Trust, as co-manager Kirsty Gibson details...
17 Sep 2021 Why companies should embrace chaos
The nimblest firms are often those that don’t fight disorder but embrace it. Gary Robinson, co-manager of Baillie Gifford US Growth Trust and Baillie Gifford American Fund, takes lessons from a pioneer of controlled chaos...
22 Apr 2021 FAANGs for the memories
The massive outperformance of mega-cap tech last year could become a thing of the past if anti-trust legislation and negative sentiment starts to bite...
09 Apr 2021 Baillie Gifford US Growth Trust Webinar
Fraser Thomson, client director, talks to Gary Robinson and Kirsty Gibson, co-managers of the Baillie Gifford US Growth Trust. The discussion centres around the recent investment environment and our thoughts for the future, all in the context of the investment approach employed by the trust. Capital at risk.
01 Apr 2020 Mind the gap
Discounts have yawned across trusts investing in private companies, but appearances can be deceptive and as COVID-19 unfolds it pays to take care…
11 Sep 2019 Nanny knows best: how regulation is influencing returns
New research suggests disruption is threatened by increased regulation, with clear consequences for investment strategists...
14 May 2019 Fund Analysis
Baillie Gifford US Growth (USA) launched in March of 2018, aiming to produce long-term capital growth through investing in listend and unlisted US equities...
09 Jan 2019 Class of 2018...
After a flood of new investment trust launches in 2018, we examine their progress so far...
16 Oct 2018 The Investment Trust Advantage
Our recent conference for discretionary fund managers saw some of the UK's leading fund managers discussing the outlook for the world's major regions and asset classes...
10 May 2018 Fund Analysis
The strategy employed for Baillie Gifford US Growth, which launched at the end of March 2018, revolves around the notion that long-term wealth...
10 May 2018 Bright young things
Recent IPOs suggest alternative income fund launches are giving way to more traditional equity funds…
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