Baillie Gifford is Bonkers

aroominyork

Alexland wrote: »

Are your employers arranging bowlhead an unfortunate accident?

God forbid. Just forward planning.

bowlhead99

Alexland wrote: »

Are your employers arranging bowlhead an unfortunate accident?

Lol, I forgot to stop posting at a nice round 8000 posts so I could bow out at a convenient stopping point. So I guess I have to keep going to 9000 now...

aroominyork

8000 post in 13 years makes 615 a year. That gives until around February 2020 to get Alex up to speed.

Alexland

aroominyork wrote: »

8000 post in 13 years makes 615 a year. That gives until around February 2020 to get Alex up to speed.

I guess this is your thread so you are free to take it completely off topic...

bowlhead99

aroominyork wrote: »

8000 post in 13 years makes 615 a year. That gives until around February 2020 to get Alex up to speed.

However, the posts have been growing somewhat exponentially, rather than a flat 615 a year. It took about seven and a half years to do the first 300 posts yet under six months for the last 600. If I'm still here by 2020, shoot me. :rotfl:

aroominyork

I'm taking this back to the original Baillie Gifford theme.

I want to increase exposure to the US where I am a bit underweight. My current US funds are in Fundsmith (which is c.60% US) and Baillie Gifford Global Alpha Growth (the open ended version of Monks, c.50% US). For a US only fund I need to choose between active or passive so I compared Baillie Gifford American to an S&P index fund over five years. I found they tracked each other closely until April 2017 which was when the BG fund took off.

My hunch is to go for the S&P index but I need to put rationale behind this. Since I only started DIYing a year ago I have seen BG in its prime: SMT, Monks, Global Discovery, American etc. Am I right in thinking that BG's recent strength is due to a high weighting towards tech heavy, growth stocks?

Prism

aroominyork wrote: »

My hunch is to go for the S&P index but I need to put rationale behind this. Since I only started DIYing a year ago I have seen BG in its prime: SMT, Monks, Global Discovery, American etc. Am I right in thinking that BG's recent strength is due to a high weighting towards tech heavy, growth stocks?

I would say that Baillie Giffords main theme would be consumer cyclical rather then tech. For example if you look at their American fund it is underweight tech and overweight consumer. SMG is roughly 50% consumer cyclical. The biggest risk is probably a recession, where consumer spending decreases. Until then however its growth all the way.

Linton

A_T wrote: »

If you look at the 20 year performance of 2 of BGs most celebrated ITs it shows that only recently have they outperformed a simple FTSE 250 tracker. OK that index is not their benchmark but still...

It's NASDAQ stocks that have pushed up their performance in recent years and quite likely those are the ones that will suffer most in a downturn. Of course if you manage to sell these at what proves to be a real high you've done well.

Such a comparison does not seem to mean very much as the ITs invest in very different things. SMI is 2.5% UK and focuses at the moment on tech. Monks is similar. Why do you choose the FTSE250? Why not compare them with the FTSE100? Or Japanese small companies or pork belly futures or whatever?


If you want to invest in UK Small Companies perhaps you could have chosen the Black Rock Small Companies or Throgmorten TrustS, or Invesco Perpetual Small Companies Trusts as comparators. They have significantly outperformed the FTSE250.

A_T

Linton wrote: »

Such a comparison does not seem to mean very much as the ITs invest in very different things. SMI is 2.5% UK and focuses at the moment on tech. Monks is similar. Why do you choose the FTSE250? Why not compare them with the FTSE100? Or Japanese small companies or pork belly futures or whatever?

A FTSE 250 tracker was chosen because there are very few tracker funds which have a history of more then 10 years. A global tracker would have been used had an appropriate one existed. Japanese smaller and pork belly futures ( ) are not very diversified. The 250 contains a number of ITs like Monks, Bankers, Personal Assets, Fidelity China SS, Harbourvest PE so it's actually quite diversified - although obviously not as much as a global index tracker. Anyway the point being over long periods of time it's difficult to beat the index.

masonic

A_T wrote: »

A FTSE 250 tracker was chosen because there are very few tracker funds which have a history of more then 10 years. A global tracker would have been used had an appropriate one existed. Japanese smaller and pork belly futures ( ) are not very diversified. The 250 contains a number of ITs like Monks, Bankers, Personal Assets, Fidelity China SS, Harbourvest PE so it's actually quite diversified - although obviously not as much as a global index tracker. Anyway the point being over long periods of time it's difficult to beat the index.

HSBC FTSE All share tracker goes back over 20 years and is more representative of the UK index (annualised returns since launch of 4.8%). Or you could have picked the HSBC American index, which goes back just as far and covers much more of the global index than any UK fund (annualised returns of 5.5%). But you opted for HSBC FTSE 250 index, with its more impressive returns of 8.6%.

The real question is, if you wanted to invest passively in the UK stockmarket 20 years ago, which index would you have chosen. I have my own opinion about that, and I suspect I am thinking along the same lines as Linton. If you wanted to invest globally, I very much doubt a FTSE250 tracker would have played a significant part in achieving that objective.