THE MANAGER of Baillie Gifford’s £350 million Edinburgh Worldwide Investment Trust feels that stock markets have settled down following the political shocks of 2016, with most companies now back to performing on an individual basis.
Douglas Brodie said that the “move away from a sentiment-led market backdrop” was of benefit to the trust, which made a net asset value return of 31.6 per cent in the year to the end of October against the S&P Global Small Cap Index’s growth of 13.4 per cent.
“We are not particularly surprised by this,” Mr Brodie added. “Stock market analysis has consistently shown that, in the longer term, company specific fundamentals ultimately prevail, hence our focus on stock selection and structural growth opportunities.”
Mr Brodie said that a diverse range of stocks had contributed to performance during the year under review, with biotechnology companies, online aggregators, e-commerce retailers and companies involved in digital manufacturing and software contributing to the trust’s growth.
At an individual stock level Mr Brodie said that American company Alnylam Pharmaceuticals made a significant contribution thanks to a positive trial from one of its drugs.
“This is the first example from its extensive drug pipeline to successfully navigate the clinical trials process and it significantly validates the core gene-silencing technology platform that underpins the business,” he said.
Mr Brodie also highlighted online lending exchange LendingTree and fibre-laser maker IPG Photonics as being significant contributors to returns.
As the trust’s main objective is to produce capital growth it is not paying a dividend for the year, although if underlying income increases it will look to make a minimum distribution in future.
This would be to maintain investment trust status as opposed to adopting an income strategy.
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules here