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Baillie Gifford Japanese Class B - Income (GBP)

Sell:1,553.00p Buy:1,553.00p Change: 19.00p (1.24%)
Prices as at 22 November 2024
Sell:1,553.00p
Buy:1,553.00p
Change: 19.00p (1.24%)
You can buy or sell holdings in this fund through a Stocks and Shares ISA, Lifetime ISA, SIPP or Fund and Share Account
Invest now
Prices as at 22 November 2024
Sell:1,553.00p
Buy:1,553.00p
Change: 19.00p (1.24%)
Prices as at 22 November 2024
You can buy or sell holdings in this fund through a Stocks and Shares ISA, Lifetime ISA, SIPP or Fund and Share Account
Invest now
The selling price currently displayed is higher than the buying price. This can occur temporarily for a variety of reasons; shortly before the market opens, after the market closes or because of extraordinary price volatility during the trading day.

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Our view on this Fund

This fund is on the Wealth Shortlist of funds our analysts believe have the potential to outperform their peers over the long term. However, this is not a recommendation to buy.

This fund invests in companies based in Japan. It focuses on larger companies but invests more in medium-sized companies than some other funds in the Japan sector. Investments in smaller businesses adds risk. The fund is managed in line with Baillie Gifford's growth-focused investment philosophy, with a focus on companies with high or sustainable growth potential.

Matthew Brett is lead manager of the fund. He has 21 years’ experience in the investment industry, all of which have been spent at Baillie Gifford . This means he’s well-embedded in the firm’s culture and style of investing.

We believe this fund could be used to diversify a global investment portfolio and add long-term growth potential or can be used by investors looking for specific exposure to Japan. It could also be used to sit alongside other funds using a value investment style and a focus on companies that have recovery potential.

With the support of an experienced team, we believe this fund has the potential to deliver good long-term returns. As always though, there are no guarantees.

Our view on the sector

Japan is home to some of the best-known businesses on the planet. Toyota, Honda, Panasonic, and Nintendo to name a few. There are also lesser-known businesses with the potential to be the household names of tomorrow. But years of sluggish growth put people off investing in the country. Former Prime Minister, Shinzo Abe, introduced policies designed to stimulate the economy and reignite interest in Japan's markets. Investor sentiment began to change but after 8 years at the helm, he announced his retirement and was replaced by Yoshihide Suga in September 2020. Suga's appointment initially offered the promise of fresh and progressive government policies and continued economic support. His tenure was dominated by the pandemic and he faced criticism over how he handled the virus. After one year in office, he stepped down as Prime Minister and has been replaced by fellow Liberal Democratic Party (LDP) member Fumio Kishida.

Performance Analysis

The fund has performed better than the broader Japanese stock market and average fund in the IA Japan sector since Brett has been involved in the fund’s management in 2008 . As always past performance isn’t a guide to future returns.

Given the fund’s growth-focused investment style, it tends to perform better when growthier companies are in favour, but not as well when value-focused companies or those undergoing a recovery are performing well. Over the longer term, our analysis shows the manager has added value through stock picking – this means the ability to invest in companies that go on to perform well, regardless of what sector they’re in, and without making ‘bigger picture’ economic calls.

All funds have tougher periods as well though, and this fund didn’t perform as well as the broader market or average fund in the sector from 2021-23 . This was partly due to the manager’s growth investment style being out of favour. Over this time, value-focused funds performed much better in Japan. The manager also had some stock selection issues.

While it’s always disappointing to see a fund go through a bad spell, this reminds us that different investment styles come in and out of favour. As a result, it’s important to maintain a diversified investment portfolio, spread across different geographies and investment styles.

Over the longer term we expect the manager to deliver performance from good stock picking, though there are no guarantees.

Investment Philosophy

The fund’s philosophy is aligned with other Baillie Gifford funds. This means Brett focuses on the fundamentals of individual companies and their long-term potential for growth. He invests in what he believes to be some of the best companies in Japan with at least a five-year view.

Process and Portfolio Construction

The fund invests in companies at different stages of growth, and is segmented into four buckets:

- Secular Growth - companies with high growth potential

- Growth Stalwart - steady compounders that may deliver steadier rates of growth

- Special Situations - larger conglomerates or businesses trading on a low share price that the manager doesn’t believe reflects their true worth

- Cyclical Growth - companies that could be more sensitive to changes in the health of the economy.

Overall, this means Brett can be categorised as a ‘growth’ investor. That said, he’s flexible and invests in a range of companies with different drivers of growth, and some that are lowlier valued and may not be typical of a growth investor.

Importantly, each business must demonstrate resilience and have an adaptable or durable enough competitive advantage that could help them deliver growth over the next 5-10 years.

question mark Manager Track Record Based on HL Quantitative Research

This information is currently unavailable.

Fund Track Record

22/11/19 to 22/11/20 22/11/20 to 22/11/21 22/11/21 to 22/11/22 22/11/22 to 22/11/23 22/11/23 to 22/11/24
Annual return 13.71% 10.08% -17.66% -3.58% 8.92%

Please remember past performance is not a guide to future returns. Where no data is shown, figures are not available. This information is provided to help you choose your own investments, remember they can fall as well as rise in value so you may not get back the original amount invested.

Information about the fund

Fund manager biography

manager photo
Manager Name: Matthew Brett
Manager start date: 1 June 2008
Manager located in: Edinburgh

Matthew is an Investment Manager in the Japanese Equities Team and has been a member of the Global Stewardship Team since its inception. He is manager of the Japanese All Cap Strategy and Lead Manager of the Japanese Income Growth Strategy. Matthew joined Baillie Gifford in 2003 and became a Partner in 2018. He is a CFA Charterholder. Matthew graduated BA (Hons) in Natural Sciences (Psychology) from the University of Cambridge in 2000 and holds a PhD in Psychology from the University of Bristol.

Data policy - All information should be used for indicative purposes only. You should independently check data before making any investment decision. HL cannot guarantee that the data is accurate or complete, and accepts no responsibility for how it may be used. Benchmark data provided subject to this disclaimer.
You can buy or sell holdings in this fund through a Stocks and Shares ISA, Lifetime ISA, SIPP or Fund and Share Account
Invest now