Capital at risk

Investment strategy

International Smaller Companies

We harness asymmetry in equity markets to capture the disproportionate impact of successful investments. These can be early-stage and immature or established, best-in-class operators in profitable niche areas.

Elephant rock in Heimaey, Vestmannaeyjar, Iceland.

Unearthing exceptional companies

We are committed to finding the most exciting smaller companies in one of the deepest and least efficient segments of the market. Our task is to look for small, exceptional companies and invest in them with an ownership mindset.

International Smaller Companies Q1 update

The International Smaller Companies Team reflects on recent performance, portfolio changes and market developments.

Generating outstanding returns for clients

We aim to outperform the benchmark (MSCI ACWI ex US Small Cap Index) by at least 3 per cent per annum over rolling five-year periods. 

We will invest in companies with a market capitalisation of $2bn or smaller, which we expect to deliver strong growth and we will sell once they reach $10bn. This allows enough room to foster significant long-term returns for our clients while sharing our insights on our most successful holdings with larger cap strategies as they exceed our size threshold.   

The performance target is aspirational and is not guaranteed. We don’t use it to compile the portfolio and returns will vary. A single performance target may not be appropriate across all vehicles and jurisdictions. We may not meet our investment objectives if, for example, our growth investment style is out of favour or we misjudge the long-term earnings growth of our holdings.

We’re in it for the long term

Great companies. Some want to shape and transform industries, others have skillsets to exploit emerging opportunities. Some operate at a superior level through distinctive culture or thoughtful stewardship.  

At the lower end of the market cap spectrum, many are often underappreciated or ignored by narrowly focused and short-term driven participants. This provides an excellent opportunity for Baillie Gifford, with its expertise in active management and belief in long-term investment, to create a truly differentiated strategy.

Looking beyond our benchmark is not an option, it’s a necessity. To uncover truly remarkable investments, we must embrace our curiosity and spirit of exploration.
Charlie Broughton

Meet the managers

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Strategy portfolio holdings

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

All figures up to: 31 March 2024

#Holding% of portfolio
1Hypoport 4.25
2AirTAC International Group3.73
3Addtech3.70
4Brunello Cucinelli3.27
5Global UniChip3.26
6Kinaxis2.71
7Reply2.70
8Chroma ATE2.56
9Alpha FX2.44
10DMG Mori2.35

Strategy holdings by sector

All figures up to: 30 April 2024

1Information Technology33.15%
2Financials18.86%
3Industrials18.21%
4Consumer Discretionary13.25%
5Communication Services6.23%
6Health Care5.54%
7Materials1.55%
8Cash1.41%
9Real Estate1.08%
10Consumer Staples0.72%
Total 100%

Strategy holdings by sector

All figures up to: 30 April 2024

Total: 100%

Strategy holdings by region

All figures up to: 30 April 2024

1Europe (ex UK)36.17%
2Developed Asia Pacific24.68%
3Emerging Markets21.36%
4UK11.98%
5North America4.40%
6Cash1.41%
Total 100%

Strategy holdings by region

All figures up to: 30 April 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.

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Insights

Key articles, videos and podcasts relating to the strategy:

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Insights

Viewing 12 of 12
  1. Tilting the odds in your favour

    The Magnificent Seven’s reputation goes before them but that’s not enough to save them.
    April 2024
    Article8 minutes
  2. International Smaller Companies Q1 update

    The International Smaller Companies Team reflects on recent performance, portfolio changes and market developments.
    April 2024
    Video12 minutes
  3. 왜 지금 성장인가?

    어려운 시기에 발휘되는 파트너십 지배구조의 강점: 급격한 변화 속에서 적응하고 성장할 수 있는 이유에 대해 분석합니다.
    2024년 3월
    Document17분
  4. International Smaller Companies Q4 update

    The International Smaller Companies Team reflects on recent performance, portfolio changes and market developments.
    January 2024
    Video13 minutes
  5. Why growth, why now?

    Tough times play to the partnership’s strengths: analysing what enables us to adapt and thrive amid rapid change.
    December 2023
    Article17 minutes
  6. International Smaller Companies: Under the Radar

    Part 6 - Alignment.
    June 2022
    Article
  7. International Smaller Companies: Under the Radar

    Part 5 - Insight.
    June 2022
    Article
  8. International Smaller Companies: Under the Radar

    Part 4 - Scalability.
    June 2022
    Article
  9. International Smaller Companies: Under the Radar

    Part 3 – Sustainability
    June 2022
    Article
  10. International Smaller Companies: Under the Radar

    Part 2 – Competitive Edge.
    June 2022
    Article
  11. International Smaller Companies: Under the Radar

    Part 1 - Opportunity
    June 2022
    Article
  12. International Smaller Companies: Under the Radar

    Introducing the Radar
    June 2022
    Article

International Smaller Companies Q1 update

The International Smaller Companies Team reflects on recent performance, portfolio changes and market developments.

Explore further

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

Important information

By clicking on South Korea, you have confirmed that you are based in South Korea and that you meet the following requirements.

The information in this area of the website is intended for qualified professional investors and consultants based in South Korea. It is not intended for use by any other persons including members of the general public or investors from other jurisdictions.

Please remember that all investment strategies have the potential for profit and loss and your or your clients’ capital may be at risk.

Baillie Gifford Overseas Limited is wholly owned by Baillie Gifford & Co. Baillie Gifford Overseas Limited provides investment management and advisory services to non-UK clients. Both are authorised and regulated by the Financial Conduct Authority. 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.

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 and a Type 2 licence from the Securities and 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 Suites 2713-2715, Two International Finance Centre, 8 Finance Street, Central, Hong Kong, Telephone +852 3756 5700.

The information provided does not constitute an offer of or solicitation for purchase or sale of securities or provision of any investment services. Any general enquiries regarding Baillie Gifford should be directed to the relevant individual as noted in the Contact Us section.

The information contained in this website has been compiled with considerable care to ensure its accuracy at the date of publication. However, no representation or warranty, express or implied, is made to its accuracy or completeness. Nothing in this information or elsewhere in this website shall exclude, limit or restrict our duties and liabilities to you under the United Kingdom's Financial Services and Markets Act 2000 or any conduct of business rules which we are bound to comply with.

This website is informative only and the information provided should not be considered as investment advice or a recommendation to buy, sell or hold a particular investment. Read our Legal and regulatory information for further details.