Baillie Gifford or HSBC?

Audaxer

MarkCarnage said:

I think that equating passive with safe, as was done, perhaps unwittingly, above is misleading. Passive gives (or should give) the relevant market index return for that asset class, less charges. Active funds can be more or less volatile than the beta of the market index. The trick is finding an active fund that gives a better return at lower risk than the market.....it's certainly not easy but it can be done though not through all phases of a market cycle. However, let's not kid ourselves that passive = low risk. 

My view is that passive can be safer, in that for many investors it could give better returns than them DIYing a selection of active funds with the correct weightings for their risk level, and managing them successfully, without the confidence or experience to do so. There is less room for error and many people would feel safer and be satisfied getting the market return over the long term with passive funds or a multi asset fund containing a balanced portfolio of passive funds.

Another_Saver

chelseablue said:

Thank you!
Regarding BG, being weighted towards growth is good isn't it? As its for a pension 
Why would HSBC be the safest bet? I was leaning towards BG but not sure now

Re: this and your first post, no growth is not "better" or "good". It's a matter of opinion as is the difference between the BG and HSBC funds. For amateur retail investors, particularly those who aren't knowledgeable about investing, sticking with index fund (also called passive investing or using tracker funds) is generally considered sensible and the HSBC fund you mentioned is a fine example of that.

Linton

When I compare funds I initially look at  2 things - what the fund invests in and the performance characteristics:

1) Investments
Both funds are broadly invested, mainly in equities.  The Baillie Gifford fund is far more oriented towards growth companies that people hope will perform well in the future as opposed to solid well established companies whereas the HSBC fund is balanced between the two  The HSBC fund concentrates on large companies whereas the Baillie Gifford has a significantly higher % of medium sized companies.  So in both aspects the Baillie Gifford fund is more adventurous.  However this is partially balanced by the HSBC fund having a lower % invested in safe bonds.

2) Performance
For 9 years years out of the past 10 both funds performed very similarly but Baillie Gifford has leapt ahead following the Covid mini-crash due to the recent exceptional performance of Growth shares. I would like to compare how they both performed during the 2008 crash but the HSBC fund wasnt around at the time.  In any case Trustnet's excellent charting facility is unusable at the moment so I cant get any info on the Baillie Gifford fund either.

For the OP's purposes and as a single  holding I would go for the HSBC fund because of its more balanced approach.  One doesnt need excitement in a long term pension portfolio especially when the evidence is that it hasnt come with sustained higher performance.

MarkCarnage

One doesnt need excitement in a long term pension portfolio especially when the evidence is that it hasnt come with sustained higher performance.

I think there's room for a bit of excitement in a long term portfolio.....and to say that it hasn't come with sustained higher performance isn't universally true. The BG fund being one example.....there are others particularly in the investment trust area. 

Thrugelmir

Tesla is having a material impact on individual fund performances, skewing the short term performance data somewhat.  There's growth and there's speculation.........