Baillie Gifford UK Growth NAV slumps 12% as discount widens
Managers Iain McCombie and Milena Mileva said it was 'disappointing to report another period of poor portfolio performance'.
In its six-month results published today (1 December), managers Iain McCombie and Milena Mileva said it was «disappointing to report another period of poor portfolio performance».
Over the period, the trust's share price total return fell by 12.5%, with the discount widening from 14.1% to 15%. According to data from the Association of Investment Companies, BG UK Growth is currently trading at a 14% discount.
The biggest detractors to portfolio performance over the period were St James's Place, FD Technologies and Burberry, the managers noted, while not owning Shell and HSBC — which had strong performance over the six months — «also hurt».
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The biggest contributors to performance was life sciences supplies business Abcam, which agreed to a takeover, alongside Wise and marketing services provider 4imprint.
McCombie and Mileva also addressed the trust's exits from Naked Wines and Farfetch, which they admitted were «mistakes», as both companies «fell short of our expectations».
They said: «Nobody likes it when a stock you own performs poorly. Moreover, we are in the difficult part of the performance cycle when stock markets punish companies severely if they report disappointing news, as has been the case for some of the holdings.
»To attempt to outperform a benchmark one has to accept, whether as a portfolio manager or a shareholder, that investing carries with it risk. It is totally reasonable to expect a portfolio manager with a well-established investment process to carry out careful analysis of any existing or potential
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