Baillie Gifford’s Troubles Mount With Billions of Outflows

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(Bloomberg) — Baillie Gifford recorded its biggest outflows in more than a decade last month as investors withdrew billions from its funds.

In October, clients pulled around £2 billion ($2.4 billion) from the firm’s UK-based funds, according to a report by research house Morningstar, with redemptions mounting to around £9 billion in the past year.

The Edinburgh-based asset manager has been struggling this year as market volatility hit the growth tech stocks that the firm has bet big on. The Scottish company has huge stakes in the likes of Moderna Inc., Carvana Co. and Illumina Inc.

Between January and the end of June, the firm saw its assets slump by more than £100 billion to £231 billion. The UK’s gilt market crisis may have added to the pressure as Baillie Gifford’s pension fund clients sold mutual funds to raise money for collateral.

The firm has been also grappling with the recent retirement of James Anderson, who over the decades influenced its strategy and tilted it towards a more radical growth approach that led to it amassing large stakes in a small number of companies.

Some of its once top-performing flagship funds have now plunged to the bottom of global performance ranks, according to data compiled by Bloomberg, and all of its roughly 80 mutual funds tracked by Bloomberg are down so far this year. Most posted double-digit losses of up to 50%.

Most of October’s redemptions came from the firm’s £3 billion Diversified Growth fund, according to the Morningstar report, which is popular with pension funds.

–With assistance from Will Louch.

©2022 Bloomberg L.P.


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