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Pridham report: Baillie Gifford investors' favourite fund manager in 2021

Pridham report: Baillie Gifford investors' favourite fund manager in 2021

Baillie Gifford is investors' favourite fund manager of 2021 as its growth-style of investing boomed during the first half of the year.

The latest Pridham report showed that Baillie Gifford saw the highest net retail sales in 2021, with £3.8bn invested.

The firm did particularly well in the first half of the year, after its style of growth investing sent its fund performance “soaring” thanks to the effects of the pandemic.

“However,” the report added, “as the year progressed and some investors decided to switch to value investing, its business slowed, though the company says it is determined to ‘stick to its knitting’.”

Liontrust was second on the list with £3.7bn of net retail sales, followed by HSBC Asset Management with £3.3bn.

Top 10 managers by net retail sales in 2021

Rank

Firm

Sales

1

Baillie Gifford

£3.8bn

2

Liontrust

£3.7bn

3

HSBC AM

£3.3bn

4

Legal & General IM

£2.4bn

5

Rathbones

£2.1bn

6

Royal London AM

£1.8bn

7

Allianz Global Investors

£1.5bn

8

BlackRock

£1.3bn

9

Fidelity

£1bn

10

Schroders

£1bn

Source: The Pridham Report

Topping the list for gross retail sales, which Helen Pridham, author of the report, said was the “true measure” of how much new money asset management groups are attracting, was Blackrock with just under £28bn invested.

Legal & General Investment Management was second, having seen sales of £15bn, with Pridham saying sales of passive funds were the main driver for success at the top two firms.

Passive fund house Vanguard does not provide its data to the report.

Top 10 managers by gross retail sales in 2021 

Rank

Firm

Sales

1

Blackrock

£28bn

2

Legal & General IM

£15bn

3

Baillie Gifford

£14bn

4

Fidelity

£13bn

5

Liontrust

£10bn

6

HSBC AM

£10bn

7

Royal London AM

£9bn

8

Schroders

£8bn

9

JP Morgan AM

£7bn

10

Fundsmith

£6bn

Source: The Pridham Report

Schroders returned to the list in 2021, with a number of popular value investing funds. Schroder Global Recovery, run by its value investing team, was one of its top selling funds in the period, as well as its Schroder Global Cities Real Estate fund.

Pridham said investors are currently unsettled, due to political uncertainty in the UK and rising geopolitical tensions.

However, Pridham said: “Increasing inflation will help to make the argument in favour of long term investment in funds in 2022, at least for those investors whose budgets are not too squeezed.”

Baillie Gifford dropped out of FE Fundinfo’s top 10 fund houses earlier this year after a number of its funds’ ratings were dropped.

Its flagship trust, Scottish Mortgage, has suffered in recent weeks after a market rotation away from growth stocks, due to expected rising interest rates. 

Since the start of December the trust has lost 24 per cent of its market value.

The jury remains out however, on whether recent market fluctuations represent a long-term transition from a growth to a value cycle, or whether the trading in the first few weeks of the year has simply been due to anxiety over monetary policy.

Last week, Laith Khalaf, head of investment analysis at AJ Bell, said as we transition from loose to tight monetary policy, he can see why there might be a continued rally in value stocks.

“Valuations in growth stocks are very high, and in an environment where interest rates are rising and the economy is doing quite well, there’s not so much of a premium that you would need to put on growth because it should be more plentiful.”