We have been an independent fund management firm for over a century now. While we have seen huge changes in the world, we have stuck firmly to the first principles our founders instilled in us. Read on to find out who we are, what defines our approach and why we believe we'll still be here for our clients a century from now.
Baillie Gifford was established as an investment management partnership over 100 years ago. Much has changed since then. For Baillie Gifford, seeking superior, long-term investment returns for our clients has not.
Our current generation of partners and employees remains single-minded about our clients’ requirements. They are responsible for the careful stewardship of our long-term vision without the distraction of short-term shareholder demands. This ownership structure allows us to attract and retain the best investment talent, creating a distinctive and enduring culture.
Baillie Gifford are long-term investors, not speculators. Our investment philosophy focuses on growth while our universe is global. Accordingly, we believe that fundamental analysis and proprietary research are core to a successful, long-term, bottom-up investment approach. From our head office in Edinburgh we are able to harness this intellectually curious and rigorous approach – where the sharing of ideas and robust debate between our investment teams are central to our investment process.
The result is a successful business that continues to grow organically. We now manage and advise £325.8bn (US$ 445.3bn) in specialist equity, fixed income and multi-asset portfolios for a global client base.
Join us as we trace our firm's approach to investment management through the generations, right back to our founders Colonel Augustus Baillie and the irrepressible Carlyle Gifford.
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Your capital is at risk. Past performance is not a guide to future returns.
A new millennium dawns. But with it a world of problems is ushered in.
A severe bear market. The sub-prime mortgage scandal. The destruction of the twin towers. The second gulf war. A bloody war in Iraq. Confidence in the markets is not high.
Yet this generation of Baillie Gifford’s partners will go on to deliver unprecedented global growth for its clients. How?
The successful surge in overseas business. A growing reputation for expertise in emerging market investing.
The birth of a concentrated 'global best' ideas portfolio that would prove to be a new way of looking at investing in the 21st century.
And a determination that despite a world in turmoil the firm must maintain its passion for investing, ultimately for the benefit of its clients.
It is the spring of 1979. And the UK market is about to go from strength to strength.
The Conservatives take power introducing sweeping changes. This leads to new opportunities.
The performance of the Baillie Gifford UK team over the next 20 years will prove invaluable to the firm’s clients.
But the key decision that will lead to growth is the serious move into pension funds.
Fortunately Baillie Gifford’s approach to investing will attract a large number of pension fund clients to want to invest with them.
And this will see assets under management grow from £3.5 billion to £16.2 billion pounds.
In only 10 years.
Proof that this generation of partners took full advantage for their clients during the great bull market of 1982 to 2000.
The finance act of '65. The Arab Israeli war in '73, leading to the quadrupling of oil prices. Rampant inflation. Sky high interest rates.
Problems for the markets mounted. And this generation was caught unprepared.
The problem was that the senior partner saw new business as a distraction, and so declined to seek any out.
But allowing the firm to become so dependent on Trusts was a strategic error.
Then in '78 the firm lost its second biggest client.
Mergers were considered. The sale of the business was discussed. But the partners were determined to remain independent.
And so they set the firm on the path that would lead to new business opportunities.
Colonel Augustus Baillie and the young Carlyle Gifford's first move into the investment business came in 1908 with the idea for a Trust to invest in the rubber industry, as the launch of the Model T Ford took America by storm.
The roaring twenties fed the pair's appetite for growth. Despite even the Wall Street Crash in 1929, the firm continued to expand.
Then in World War Two came Gifford's finest hour. The Governor of the Bank of England chose him to sell the country's assets on the New York Stock Exchange in order to build the nation's war chest. The way he went about it made him a celebrity in the US.
Time magazine calling him, "No nervous Nellie as he oversees the biggest selling order in history."
It was a fitting final success story for the first generation of Baillie Gifford.
Following in the founders' footsteps.
In one way the Baillie Gifford of today, based in Calton Square, is a very far cry
from the original two partners and five clerks who started it all in Hill Street in 1908.
But when it comes to taking a curious, patient and brave approach to investment
management for the benefit of its clients, absolutely nothing has changed.
In a nutshell, Baillie Gifford has fostered a culture based on partnership, rigorous research methods and an investment philosophy that focuses on growth over the long term.
In equities, our belief is that sustained growth in company profits leads to higher share prices over time. In bonds, we take a differentiated investment approach, which focuses on long-term prospects rather than the potential for short-term price movements.
Our rigorous process of fundamental analysis and proprietary research, combined with a depth of expertise, are core to a successful, long-term, bottom-up investment approach. This allows us to exploit global opportunities over periods of, typically, five years or more. It’s a philosophy that has guided our investment strategy for more than a century, so no one can say we don’t practice what we preach.
FOCUS ON CLIENTS
We would be nothing without our clients. That may seem obvious, but can easily be overlooked. All too often the financial sector will chase new business to the potential detriment of existing clients. At Baillie Gifford, existing clients’ interests are paramount and we frequently close our products to new business to ensure that the integrity of our strategies and the quality of service are maintained. This commitment to professional excellence ensures clients receive our full attention. Our single-minded approach has enabled us to enjoy relationships with clients that have spanned generations.
Today we manage money on behalf of some of the world’s largest professional investors. We manage international portfolios for US and Canadian clients and have a blue-chip client base covering corporate, public and foundation assets. We have had Asian clients since 1989 and we manage funds for some of Continental Europe’s leading pension funds and financial institutions. Our broad geographical exposure also encompasses professional investor clients in Australia, Singapore, Hong Kong, China, Thailand, Korea, the Middle East and South Africa.
Through each successive generation of partners, our singular focus on generating superior long-term investment results for our clients has been the bedrock of our own growth. Baillie Gifford today is wholly owned by its 46 partners – all of whom work within the firm. Growth has been organic, with no mergers or acquisitions, and we are committed to remaining independent.
This partnership style is rare among large investment management companies and creates one key advantage: with no external shareholders demanding short-term gains, we can focus solely on what we do best - seeking out long-term investment returns for our clients.
The organisational stability created by this ownership structure means that we can recruit and retain some of the best people in the industry.
Partnership encourages personal responsibility, creating a strong culture of questioning, debate and respectful trust in which the finest investment minds are nurtured and thrive.
This, in turn, means we can continue to find the best long-term investment opportunities. It’s a virtuous circle that has served us well for over a century.
What makes an Actual investor? For us it’s being curious, patient and brave. Let us explain what that means to us, and more importantly, what it might mean to you.
OUR INVESTMENT CAPABILITIES
Who we are is as important as what we do. We bring you an experienced team of passionate, questioning investors completely focused on delivering long-term returns. That’s our edge. These are our capabilities.
In markets seduced by complexity, we believe in keeping things simple. We invest in what we think are the most competitive, innovative and efficient growth companies. Over a century of global investment experience has taught us that patience is vital, so we build long-term, committed portfolios that aim to anticipate the next decade, not the next quarter. Most importantly, we love what we do and we don’t invest by rote or by numbers alone. Our analysts conduct rigorous, qualitative, fundamental analysis to determine whether to invest. We know that the equity markets may not agree with us, and that’s okay; it’s more profitable to lead than to follow, and we never stop questioning or challenging the status quo.
We are different. We are truly active investors, looking to construct focused portfolios of long-term investments. With a global opportunity set, we invest in government bonds and currencies, emerging market bonds, investment grade and high yield. Our highly experienced investors undertake rigorous proprietary analysis focused on fundamental investment characteristics to identify attractive opportunities around the world. We recognise that the asymmetric nature of bonds, with capped upside, makes risk management key to achieving our investment objective and it is integral to our approach.
We don’t believe in limiting our investment opportunities. Listed equities, property, high yield credit, commodities, emerging market government bonds and insurance-linked securities – these are just some of the asset classes we invest in. It is our core belief that diversifying across asset classes can reduce risk without significantly reducing returns. Maximising our investment opportunities raises the likelihood of finding individually attractive asset classes and also helps us to achieve a balanced and diversified portfolio. We focus only on absolute risk and absolute return, considering an asset class for its ability to enhance returns or reduce volatility. We offer our clients access to a broad mix of asset classes through the convenience of a single actively-managed portfolio.
- Actual Investors look at the big picture. Not just the small print.
ABOUT THE WORLD
And we truly believe that the best investment ideas spring from thinking about future possibilities, not short-term probabilities.
We appreciate of course that the world is complex but we believe that the way to generate long-term returns for our clients is to focus on the deceptively simple task of identifying and investing in those companies which have the potential to grow at a faster rate, on a more sustainable basis, than their peers. So we conduct rigorous qualitative research to establish whether prospective investments have the competitive, financial and strategic advantages to deliver on that potential. And we love to share our insights.
Our investment ideas are discussed and debated across our investment teams, from those of the most junior analysts to partners of the firm. We are always looking for that novel insight, offbeat observation or penetrating challenge to help round out the investment case and enhance our collective knowledge.
And because there are no enduring right answers in investment, we never stop asking questions.