1. Navigating

  2. September 2020

    All investment strategies have the potential for profit and loss, your or your clients’ capital may be at risk. Past performance is not a guide to future returns


    Tune in to LTGG’s video series for a long-term perspective on today’s transformational companies.

    It was the development scholar Carlota Perez who noted that US blue collar workers in the 1930s Depression could never have imagined the coming jobs-for life era, with its fully-equipped suburban houses and cars in every garage. Similarly, few 1960s hippies would have guessed that natural materials and organic foods would become the preserve of luxury and premium brands.

    That periods of change can herald new and unexpected opportunities is, of course, nothing new. From the canal network of the 18th century, to the steam engines of the 19th, to the internal combustion, oil and plastics age of the 20th, to the information technology age in which we live, each revolution has shown striking similarities. Initial giddy excitement (canal and railway mania, the Roaring Twenties, the dot-com boom) was followed by deep and destructive recessions. These then lead to golden ages of creative construction and prosperity: the Industrial Revolution and the great Victorian boom, the Belle Époque and the Progressive Era of the early 1900s, and the post-second world war golden age.

    So where are we now? Arguably still in the early stages of the IT age, replete with all the excitement, experimentation and fragilities characteristic of prior revolutions. Could the dot-com bubble and global financial crisis of the early 2000s have been harbingers of the new age? Could that turmoil have nurtured a new tech-enabled and sustainable golden age that will blossom for decades to come?

    Professor Carlota Perez thinks so. Her fascinating research challenges us to interpret present-day phenomena from the vantage point of 240 years of technological revolutions.

    Such differentiated thinking matters to us as long-term investors. By stepping back from the minute-by-minute news and the relentless treadmill of market commentary, and by challenging received wisdom and our own inherent biases, we can try more fully to understand the tectonic shifts already transforming the world as we know it. From genomics to semiconductors to media streaming to cloud computing to big data to the commercialisation of space travel, the drivers of change and opportunity abound.

    Navigating Noise, a video series brought to you by the Long Term Global Growth team, seeks to gather and share some of the thinking we find so valuable when investing for the long term.

    Fittingly, the series kicked-off in May with a lecture by Professor Perez on her research into the aforementioned paradigm shifts and what they may imply for the shape of tomorrow. In subsequent episodes, LTGG team members will examine some of the striking traits of companies spearheading and benefiting from these sorts of transformations.

    For example, what special qualities should we look for in the leadership of such companies? These are the intangible factors that can’t be deciphered from earnings reports and traditional financial metrics, but which nevertheless have enormous bearing on the fortunes of a business. Also, how can we challenge preconceptions about the prospects of already-giant companies as they surge to a hitherto unseen scale? And is it possible to step back from often-blinkered perceptions promulgated by politics and news media, to think globally about exciting growth opportunities?

    We don’t believe we are anywhere close to having all the answers to such questions. But our conversations with our clients, together with visionary business leaders and academic thinkers, do help us enormously. When watching Navigating Noise, please share your questions and comments with us. By continually challenging ourselves, we believe we can get better at generating long-term returns on your behalf.

    To watch Navigating Noise, please visit ltgg.bailliegifford.com and click on 'Navigating Noise' at the top of the site – we will be adding episodes to the series in coming months.


    The views expressed in this article are those of the authors and should not be considered as advice or a recommendation to buy, sell or hold a particular investment. They reflect personal opinion and should not be taken as statements of fact nor should any reliance be placed on them when making investment decisions.

    This communication was produced and approved in September 2020 and has not been updated subsequently. It represents views held at the time of writing and may not reflect current thinking.

    Potential for Profit and Loss

    All investment strategies have the potential for profit and loss, your or your clients’ capital may be at risk. Past performance is not a guide to future returns.

    Changes in the investment strategies, contributions or withdrawals may materially alter the performance and results of the portfolio.

    Stock Examples

    Any stock examples and images used in this article are not intended to represent recommendations to buy or sell, neither is it implied that they will prove profitable in the future. It is not known whether they will feature in any future portfolio produced by us. Any individual examples will represent only a small part of the overall portfolio and are inserted purely to help illustrate our investment style.

    This article contains information on investments which does not constitute independent research. Accordingly, it is not subject to the protections afforded to independent research, but is classified as advertising under Art 68 of the Financial Services Act (‘FinSA’) and Baillie Gifford and its staff may have dealt in the investments concerned.


    All information is sourced from Baillie Gifford & Co and is current unless otherwise stated.

    The images used in this article are for illustrative purposes only.



    Baillie Gifford & Co and Baillie Gifford & Co Limited are authorised and regulated by the Financial Conduct Authority (FCA). Baillie Gifford & Co Limited is an Authorised Corporate Director of OEICs.

    Baillie Gifford Overseas Limited provides investment management and advisory services to non-UK Professional/Institutional clients only. Baillie Gifford Overseas Limited is wholly owned by Baillie Gifford & Co. Baillie Gifford & Co and Baillie Gifford Overseas Limited are authorised and regulated by the FCA in the UK.

    Persons resident or domiciled outside the UK should consult with their professional advisers as to whether they require any governmental or other consents in order to enable them to invest, and with their tax advisers for advice relevant to their own particular circumstances.

    Baillie Gifford Investment Management (Europe) Limited provides investment management and advisory services to European (excluding UK) clients. It was incorporated in Ireland in May 2018 and is authorised by the Central Bank of Ireland. Through its MiFID passport, it has established Baillie Gifford Investment Management (Europe) Limited (Frankfurt Branch) to market its investment management and advisory services and distribute Baillie Gifford Worldwide Funds plc in Germany. Baillie Gifford Investment Management (Europe) Limited also has a representative office in Zurich, Switzerland pursuant to Art. 58 of the Federal Act on Financial Institutions (“FinIA”). It does not constitute a branch and therefore does not have authority to commit Baillie Gifford Investment Management (Europe) Limited. It is the intention to ask for the authorisation by the Swiss Financial Market Supervisory Authority (FINMA) to maintain this representative office of a foreign asset manager of collective assets in Switzerland pursuant to the applicable transitional provisions of FinIA. Baillie Gifford Investment Management (Europe) Limited is a wholly owned subsidiary of Baillie Gifford Overseas Limited, which is wholly owned by Baillie Gifford & Co.

    Hong Kong

    Baillie Gifford Asia (Hong Kong) Limited 柏基亞洲(香港)有限公司 is wholly owned by Baillie Gifford Overseas Limited and holds a Type 1 licence from the Securities & Futures Commission of Hong Kong to market and distribute Baillie Gifford’s range of collective investment schemes to professional investors in Hong Kong. Baillie Gifford Asia (Hong Kong) Limited 柏基亞洲(香港)有限公司 can be contacted at Room 3009-3010, One International Finance Centre, 1 Harbour ViewStreet, Central, Hong Kong. Telephone +852 3756 5700.

    South Korea

    Baillie Gifford Overseas Limited is licensed with the Financial Services Commission in South Korea as a cross border Discretionary Investment Manager and Non-discretionary Investment Adviser.


    Mitsubishi UFJ Baillie Gifford Asset Management Limited (‘MUBGAM’) is a joint venture company between Mitsubishi UFJ Trust & Banking Corporation and Baillie Gifford Overseas Limited. MUBGAM is authorised and regulated by the Financial Conduct Authority.


    This material is provided on the basis that you are a wholesale client as defined within s761G of the Corporations Act 2001 (Cth). Baillie Gifford Overseas Limited (ARBN 118 567 178) is registered as a foreign company under the Corporations Act 2001 (Cth). It is exempt from the requirement to hold an Australian Financial Services License under the Corporations Act 2001 (Cth) in respect of these financial services provided to Australian wholesale clients. Baillie Gifford Overseas Limited is authorised and regulated by the Financial Conduct Authority under UK laws which differ from those applicable in Australia.

    South Africa

    Baillie Gifford Overseas Limited is registered as a Foreign Financial Services Provider with the Financial Sector Conduct Authority in South Africa.

    North America

    Baillie Gifford International LLC is wholly owned by Baillie Gifford Overseas Limited; it was formed in Delaware in 2005 and is registered with the SEC. It is the legal entity through which Baillie Gifford Overseas Limited provides client service and marketing functions in North America. Baillie Gifford Overseas Limited is registered with the SEC in the United States of America.

    The Manager is not resident in Canada, its head office and principal place of business is in Edinburgh, Scotland. Baillie Gifford Overseas Limited is regulated in Canada as a portfolio manager and exempt market dealer with the Ontario Securities Commission. Its portfolio manager licence is currently passported into Alberta, Quebec, Saskatchewan, Manitoba and Newfoundland & Labrador whereas the exempt market dealer licence is passported across all Canadian provinces and territories. Baillie Gifford Investment Management (Europe) Limited (‘BGE’) relies on the International Investment Fund Manager Exemption in the provinces of Ontario and Quebec.


    Baillie Gifford Overseas is not licensed under Israel’s Regulation of Investment Advising, Investment Marketing and Portfolio Management Law, 5755-1995 (the Advice Law) and does not carry insurance pursuant to the Advice Law. This document is only intended for those categories of Israeli residents who are qualified clients listed on the First Addendum to the Advice Law.


    Baillie Gifford Overseas Limited (“BGO”) neither has a registered business presence nor a representative office in Oman and does not undertake banking business or provide financial services in Oman. Consequently, BGO is not regulated by either the Central Bank of Oman or Oman’s Capital Market Authority. No authorization, licence or approval has been received from the Capital Market Authority of Oman or any other regulatory authority in Oman, to provide such advice or service within Oman. BGO does not solicit business in Oman and does not market, offer, sell or distribute any financial or investment products or services in Oman and no subscription to any securities, products or financial services may or will be consummated within Oman. The recipient of this document represents that it is a financial institution or a sophisticated investor (as described in Article 139 of the Executive Regulations of the Capital Market Law) and that its officers/employees have such experience in business and financial matters that they are capable of evaluating the merits and risks of investments.


    This strategy is only being offered to a limited number of investors who are willing and able to conduct an independent investigation of the risks involved. This does not constitute an offer to the public and is for the use only of the named addressee and should not be given or shown to any other person (other than employees, agents, or consultants in connection with the addressee’s consideration thereof). Baillie Gifford Overseas Limited has not been and will not be registered with Qatar Central Bank or under any laws of the State of Qatar. No transactions will be concluded in your jurisdiction and any inquiries regarding the strategy should be made to Baillie Gifford.


    48727 INS WE 0666