Baillie Gifford overtakes JP Morgan to take trust top spot

Baillie Gifford overtakes JP Morgan to take trust top spot

Edinburgh-based investment partnership Baillie Gifford has overtaken JP Morgan to become the largest investment trust business in the UK, as measured by market capitalisation.

Data from the Association of Investment Companies (AIC) shows that Baillie Gifford’s seven investment trusts had a total market cap of £10.8bn at the end of April 2018, compared with £9.6n for the 21 trusts run by JP Morgan.

The latter firm continues to have more total assets than Baillie Gifford, however. JP Morgan trusts have total assets of £11.5bn, compared with £11.4bn for Baillie Gifford.

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The difference between total assets and the market capitalisation is that the latter is dictated by the share prices at which the trusts trade, while the former is a measure of the underlying performance of the investments held in the trust.

Share prices can move at a different pace, or in a different direction, to asset prices.

The growth in Baillie Gifford’s investment trust business has been driven by the progress of the £7bn Scottish Mortgage investment trust, which has tripled investors money over the past five years.

Tim Piggot, who runs Pigotts Investments in Dorking ,said “Scottish Mortgage is a trust you couldn’t be without.”

The Monks investment trust, which is £1.7bn in size, was a noted under performer for Baillie Gifford until 2015, when Charles Plowden, managing partner at Baillie Gifford took the helm.

Tony Yousefian, analyst at Fund Calibre, said the track record of the Monks investment trust since the new management team took over is impressive.

The trust has returned 82 per cent over the past three years compared with 52 per cent for the average fund in the AIC Global sector in the same time period.

JP Morgan’s largest trusts include the £1.05bn JP Morgan American, which has returned 94 per cent over the past five years to 3 May, compared with 52 per cent for the average trust in the AIC North America sector in the same time period.

The £1.2bn JP Morgan Emerging Markets investment trust has returned 46 per cent over the past five years to 3 May, compared with 24 per cent for the sector average.  

The figures compiled by the AIC do not include the roughly £300m of assets in what is presently called the Schroders UK Growth Trust. As FTAdviser previously reported, the trust will be managed by Baillie Gifford. In a statement to the stock exchange this morning, the board of the trust said it expects the transition to Baillie Gifford to be completed by no later than the middle of July.