China bull Baillie Gifford warns of growing threat to foreign investors

Bailey Gifford warned of growing risks for foreign investors in China after a year of punishment on the fund manager’s Scottish Mortgage Investment Trust, when its daring bets on the country’s growth companies and the global technology sector were hurt.

Tom Slater, director of the £ 14.4 billion Scottish Mortgage Fund, which was added to its Chinese holdings last year, said the war in Ukraine has exacerbated US-China relations and that foreign investors should consider the restrictions that Beijing may impose on their investment profits.

“The challenge now for Western investors is twofold: to integrate the low but increased chances of future US sanctions into assessing Chinese investment and examining how the Chinese state might limit the rise in stock prices for the breakthrough winners,” he said.

The verdict is as prominent as Bailey Gifford One of the largest bulls in China In recent years, a strategy that has helped make Scottish Mortgage the largest investment fund in the UK.

Slater added: “In retrospect, it was a mistake to reduce our holdings in Western online platform companies rather than their Chinese counterparts,” but said the fund’s investments in China were “largely unchanged” this year.

Comments came when Scottish Mortgage’s bets on Chinese groups and technology companies were stopped by High-growth stock sales Powered by China’s rising interest rates and China’s strict zero-cobide approach to managing the corona plague. Trust stocks have fallen about half since their peak in November.

After record returns last year, the Trust reported on Thursday that its performance was lagging behind the broad market in the 12 months to the end of March, with a 9.5% drop compared to a 13% rise in its global FTSE index.

Scottish mortgage Early and stubborn backup Of innovative companies like Tesla, Tencent and Modern have made it one of the best-performing investment instruments in the UK in recent years, with an army of loyal followers among small investors.

The results came following the departure of James Anderson, Which for more than 20 years led by Scottish Mortgage has become one of the UK’s well-known technology investors. In November he called on investors not to “give up China”.

Anderson, who announced his intention to retire last year, has managed the trust together with Slater since 2015.

Even after the recent fall, the 113-year fund returned 697 percent, measured at the overall return on the stock price, for 10 years against a 231 percent increase in its benchmark. Bailey Gifford, based in Edinburgh, is known for her long-term investment philosophy and has urged investors to look beyond short-term pain.

“A real long-term investment requires not only patience but the ability to endure periods of intense discomfort,” said Deputy CEO Lawrence Burns.

China bull Baillie Gifford warns of growing threat to foreign investors Source link China bull Baillie Gifford warns of growing threat to foreign investors

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