Baillie Gifford unveils Global Alpha Growth fund

Baillie Gifford has increased its global equity capabilities with the launch of the Global Alpha Growth fund.

The Baillie Gifford Global Alpha Growth utilises an existing bottom-up investment process the group has applied for segregated clients since May 2005.

Charles Plowden, joint senior partner of Baillie Gifford, leads the team – which also includes managers Spencer Adair and Malcolm MacColl. All three have been involved with the Global Alpha approach since its inception.

Baillie Gifford says the strategy has delivered returns of more than 11% over its MSCI All Countries World Index benchmark from inception to end 2009.

The group currently has two global products accessible for retail investors – the Baillie Gifford International and Global Income funds. The £159m Baillie Gifford International fund is top quartile in the IMA Global Growth sector over one, three and five years to 8 March, according to Morningstar.

Baillie Gifford Global Alpha Growth consists of 100 stocks – split evenly between North America, Europe and Asia.

Adair says the team seeks to identify strong growth prospects over a five-year period by exploiting four different criteria.

“This is a pretty simple fund. We simply try to find the best growth ideas irrespective of which country it is headquartered in,” Adair says.

“Firstly, there are the companies displaying rapid growth of 20% per annum plus. Our analysis in this area tries to identify how sustainable this growth is and the timing of any competition.

“Then there are the growth stalwarts; those companies capable of churning out growth about 10% or so a year irrespective of headwinds or tailwinds.

“We also look for the cyclical growers over a longer-term view, knowing full well there will be ups and downs along the way. Finally we try to identify stocks in change.

“These are the businesses where the industry or competitive position has changed materially.”

Global Alpha Growth has a 5% initial charge and 1.5% AMC for retail investors. Minimum investment is £1,000.

The fund was launched at the beginning of March.