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A Strong Long-Term Option Worth Watching

Christopher Franz, CFA

Christopher Franz: Baillie Gifford Emerging Markets is led by a seasoned, long-term-oriented management team and is on our radar. 

Though it has recently broadened its presence in the U.S. market, Edinburgh-based Baillie Gifford’s roots date to the early 1900s, and the firm currently manages over $200 billion.

The management team here is experienced. Richard Sneller leads an eight-member group, who spent most of their careers with the firm. Sneller himself helped launch the strategy in 2003 and is among a handful of partners at the privately held firm.

Now, this long-term nature is displayed in the portfolio. The group is patient, with an annual portfolio turnover far below peers, and they pay little heed to short-term earnings. Names are owned with conviction, and the team is willing to hold riskier fare, which does lead to higher Morningstar Risk Ratings.

Still, the strategy has delivered over the long haul, with top-decile results since inception. Further aided by competitive fees, we think the strategy can be a strong long-term option.