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Investment strategy

International Concentrated Growth

International Concentrated Growth is a bottom-up equity strategy focused on outstanding growth firms. It invests in businesses making structural changes to the economy and society.

The Kelpies sculptures in Falkirk, Scotland in the evening.

Powerful potential

This is a concentrated portfolio of exceptional international growth companies, which are driving transformation in societies and economies and therefore have the potential to take substantial market share. 

International Concentrated Growth: manager introductions

Radical companies may seem risky, but they’re building the future. Paulina McPadden, Spencer Adair and Lawrence Burns discuss how investing in firms with extraordinary potential is a simple approach to long-term wealth creation.

Unique, concentrated, long term

ICG has three advantages. First, it has exceptionally long holding periods. Second, it is centred on the asymmetry of stock returns and the investment case upside. Third, it is concentrated and willing to take large holdings when justified by the probability-weighted returns available.  

The strategy aims to grow clients’ assets over a five to ten-year horizon by investing in growth companies driving change. Our goal is to exceed the MSCI ACWI ex US index by 3 per cent+ per annum over rolling five-year periods. Our approach to portfolio construction is purely stock-driven, without reference to any benchmark. 

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.

Years, not quarters

Long-termism is central to our philosophy. A company’s value is rarely determined over a few quarters. 

We’re interested in companies that may grow significantly over five to ten years, in structural or even explosive ways. These are rare, so we adopt a concentrated portfolio of 20-35 stocks from developed and emerging markets. 

We believe it’s important not to ignore companies that may significantly disrupt international markets, despite being based in the US. The strategy can therefore invest up to 15 per cent in the US.

We each bring our passions and interests to the team. What links us together is a commitment to investing in companies that are driving deep structural changes in the economy.
Paulina McPadden

Meet the managers

Documents

Philosophy and process

Explore our investment philosophy and the processes around how the team constructs the portfolio.

Quarterly update

Get the latest investment commentary, portfolio overview, transactions and performance information alongside governance engagement and voting. 

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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 December 2023

#Holding% of portfolio
1MercadoLibre13.91
2ASML11.66
3Spotify5.98
4NVIDIA5.47
5Adyen5.33
6Hermès International4.30
7Ocado4.25
8Ferrari4.05
9Kering3.70
10Moderna3.41

Strategy holdings by sector

All figures up to: 31 January 2024

1Consumer Discretionary39.71%
2Information Technology23.47%
3Communication Services9.34%
4Health Care8.96%
5Financials8.49%
6Consumer Staples5.67%
7Cash2.09%
8Industrials1.98%
9Materials0.28%
Total 100%

Strategy holdings by sector

All figures up to: 31 January 2024

Total: 100%

Strategy holdings by region

All figures up to: 31 January 2024

1Europe (ex UK)53.13%
2Emerging Markets23.85%
3North America14.86%
4UK4.79%
5Cash2.09%
6Developed Asia Pacific1.29%
Total 100%

Strategy holdings by region

All figures up to: 31 January 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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Curious to learn more about our products and what we can offer you? Please get in touch.