1. INVESTMENT GRADE BOND FUND
    INVESTMENT GRADE BOND FUND

    Overview

    The Investment Grade Bond Fund aims to outperform (after deduction of costs) the ICE Bank of America Merrill Lynch Sterling Non-Gilt Index by 0.5% per annum over rolling three-year periods. There is no guarantee that this objective will be achieved over any time period and actual investment returns may differ from this objective, particularly over shorter time periods.

    The manager believes this is an appropriate benchmark given the investment policy of the Fund and the approach taken by the manager when investing. In addition, the manager believes an appropriate performance comparison for this Fund is the Investment Association Sterling Corporate Bonds Sector.

    As we prospect for ideas we value robust debate. This is why the investment teams are kept small, why we rotate sector coverage, and why our ideas are shared with the wider firm.

    Portfolio

    Top Ten Physical Bond Holdings* - 30/09/2020

    Fund %
    1 UK Treasury 3.25% 22/01/2044 2.5%
    2 EIB 4.5% 2044 2.2%
    3 KFW 6% 2028 2.2%
    4 Network Rail 4.75% 2024 2.0%
    5 LCR Finance 4.5% 2028 1.8%
    6 KFW 5.75% 2032 1.6%
    7 Network Rail 4.75% 2035 1.6%
    8 KFW 0.875% 2026 1.5%
    9 EIB 6% 2028 1.5%
    10 Annington Funding 3.184% 2029 1.5%
    Total 18.4%
    Fund %
    1 UK Treasury 3.25% 22/01/2044 2.5%
    2 EIB 4.5% 2044 2.2%
    3 KFW 6% 2028 2.2%
    4 Network Rail 4.75% 2024 2.0%
    5 LCR Finance 4.5% 2028 1.8%
    6 KFW 5.75% 2032 1.6%
    7 Network Rail 4.75% 2035 1.6%
    8 KFW 0.875% 2026 1.5%
    9 EIB 6% 2028 1.5%
    10 Annington Funding 3.184% 2029 1.5%
    Total 18.4%
    Sector Analysis of Total Assets - 30/09/2020
    As the Fund invests in overseas securities, changes in the rates of exchange may cause the value of your investment (and any income it may pay) to go down or up.
    The information contained on this page is intended as a guide only and should not be relied upon when making investment decisions. All holdings information is unaudited. Source Baillie Gifford & Co.
    Please note that totals may not add due to rounding.
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    Meet the Manager

    Paul Dilworth

    Paul joined Baillie Gifford in 2019 and is an Investment Manager in the Credit Team. Previously, Paul worked for almost 13 years at Kames Capital where he was responsible for managing a broad range of fixed income mandates, including Global Financial Credit, Global Absolute Return and Investment Grade Credit. Paul is a CFA Charterholder and graduated BSc (Hons) in Mathematics from Heriot-Watt University in 2006.

    How to Buy

    You can invest in a range of our funds via a number of fund platforms and supermarkets, please see the links opposite. Further information on the funds can be found in the relevant Key Investor Information and Prospectus Documents, which are available in English and will be sent to you free of charge on request. Information on the range of funds available through platforms can be found in our Platform Matrix.

    Baillie Gifford does not sponsor, maintain or have any control over the content of any other websites. Therefore, we are not responsible for the adequacy or accuracy of any of the information you may view, nor do we undertake to ensure successful transmission to any linked website.

    Fund Platforms/Supermarkets

    OEIC Terms of Business

    To buy and sell our funds, you must complete and return a copy of the document below, if you don't already have an agreement with us. In order for us to accept your business for our range of OEICs, please complete and return the Terms of Business Acceptance Form.

    Documents

    You can access any literature about the Fund here, either by downloading or requesting a copy by post (where available). To download any document you will need Adobe Reader.  Please note that we can now provide you with Braille and audio transcriptions of our literature on request. It may take up to 10 days for the transcription to be completed dependent on the size of the document.

    Risks

    General Investment Risk

    Investment markets can go down as well as up and market conditions can change rapidly. The value of an investment in the Fund, and any income from it, can fall as well as rise and investors may not get back the amount invested.

    Custody

    Custody of assets involves a risk of loss if a custodian becomes insolvent or breaches duties of care.

    Bonds & Inflation

    Bonds issued by companies and governments may be adversely affected by changes in interest rates, expectations of inflation and a decline in the creditworthiness of the bond issuer. The issuers of bonds in which the Fund invests may not be able to pay the bond income as promised or could fail to repay the capital amount.

    Concentration

    The Fund’s concentrated portfolio relative to similar funds may result in large movements in the share price in the short term.

    Derivatives

    Derivatives may be used to obtain, increase or reduce exposure to assets and may result in the Fund being leveraged. This may result in greater movements (down or up) in the price of shares in the Fund. It is not our intention that the use of derivatives will significantly alter the overall risk profile of the Fund.

    Volatility

    The Fund’s share price can be volatile due to movements in the prices of the underlying holdings and the basis on which the Fund is priced.

    Dilution

    A dilution adjustment may apply when you buy or sell shares in the Fund. This is applied to the share price and may reduce the return on your investment.

    Under certain market conditions it can be difficult to buy or sell securities and even small purchases or sales can cause their prices to move significantly. To manage the effects of this, we may apply an increased dilution adjustment. As a result investors may face increased dealing costs.

    Fees to Capital

    From 1 October 2019 the fund expenses will be taken from Fund’s capital. This will reduce the capital value of the Fund. The figure for the current financial period has not yet been determined.

    Market Conditions

    Market values for illiquid securities which are difficult to trade may not be readily available, and there can be no assurance that any value assigned to them will reflect the price the Fund might receive upon their sale.

    Government and Public Securities

    More than 35% of scheme property may be invested in securities issued or guaranteed by Governments and/or other organisations worldwide.  For further details please see the Prospectus.

    Tax Rates

    Tax rates and the tax treatment of OEICs can change at any time.