Capital at risk

Investment strategy

Investment Grade Bond

Investment-grade corporate bonds offer potentially compelling risk-adjusted returns, providing higher income than government bonds with little increase in the risk of default.  

Our research-intensive process and extensive experience give us deep insight into companies, differentiating us from other market participants. 

A museum display of seashells with handwritten descriptions.

A sharp focus on inefficiencies

We aim to provide attractive returns with low risk by maximising the opportunities offered by diverse global businesses.

Corporate bond markets show persistent structural inefficiencies. Our approach is designed to exploit these. We find companies offering attractive compensation relative to their strengths, creating a portfolio that we believe will outperform the market in the long term.

A purposeful, conviction-led portfolio

Through deep research we seek to identify resilient companies that can adapt as societies and technologies change. We blend this with our top-down view of the economic environment, our collaborative approach helping identify macroeconomic trends and transitory forces. We then construct a diverse core portfolio of about 50-90 companies.

A patient and flexible approach

While we typically lend to companies for many years, we remain live to short-term inefficiencies in markets – actively seeking to generate returns by selecting specific bond issues which are available with differing maturities, capital protections and currency of issue.

My priority is to protect clients’ capital. To maximise long-term returns, prudent risk taking is key: I ensure the risks are intentional, well-diversified and sized appropriately.
Paul Dilworth

Meet the managers

Paul Dilworth

Paul Dilworth

Paul is an investment manager in the Credit Team, co-manging the Investment Grade and Sterling Aggregate strategies. He joined Baillie Gifford in 2019. Before joining the firm, 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 graduated BSc (Hons) in Mathematics from Heriot-Watt University in 2006 and is a CFA Charterholder.

Nektarios Chatzilefteris Michalas

Nektarios Chatzilefteris Michalas

Nektarios is an investment manager in the Credit Team, co-managing the Investment Grade Bond Strategy. He joined Baillie Gifford in 2020. Prior to joining the firm, he served for 8 years as an artillery officer in the army followed by 4 years in a variety of banking and insurance roles. He graduated BSc in Military Operations Management and Battle Science from the Hellenic Military Academy in 2008 and MBA from the University of Macedonia in 2017. Nektarios is a CFA Charterholder.

Explore further

Curious to learn more about our products and what we can offer you? Please get in touch.

Strategy portfolio holdings

A list of the top 10 holdings that the representative portfolio invests in.

All figures up to: 31 August 2024

#Holding% of portfolio
1Blackstone Private Credit 4.875% 20262.2%
2International Workplace Group 6.5% 20302.1%
3AT&T 7% 20401.9%
4UK T Bill 30/09/20241.7%
5Nationwide 5.875% 2024 Perp AT11.5%
6Burberry 1.125% 20251.5%
7Kyndryl Holdings 6.35% 20341.4%
8UK Treasury 4.5% 07/12/20421.4%
9IBRD 0.25% 20261.3%
10Yorkshire Building Society 6.375% 2027/281.3%

Strategy holdings by sector

As at: 31 August 2024

1Industrials30.70%
2Financial29.20%
3Quasi & Foreign Government11.90%
4Securitized10.30%
5Utility9.30%
6Sovereign7.20%
7Cash & Derivatives1.40%
Total 100%

Strategy holdings by sector

All figures up to: 31 August 2024

Total: 100%

Please note

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.

Explore further

Curious to learn more about our products and what we can offer you? Please get in touch.