Baillie Gifford has been hit by a £113bn fall in the value of its assets under management.
The Edinburgh-based firm revealed the full toll of a torrid 2022 which saw global stocks fall significantly, particularly in the tech sector.
According to a report in the Financial Times, Baillie Gifford’s total assets plunged from £336bn at the end of 2021 to just £223bn by the close of 2022. A spokesperson for Baillie Gifford confirmed the reported AUM figures to Portfolio Adviser and declined to comment further.
The firm, which manages one of Britain’s biggest and most popular investment trusts, Scottish Mortgage, leant heavily on tech stocks such as Tesla and Apple as it amassed a third of a trillion in total assets.
That meant it was hard hit by the large drawdown in the valuations of growth stocks prompted by the Federal Reserve’s rate rising cycle. Chair Jerome Powell and his Fed colleagues shook markets last year with a series of sharp rises in order to rein in inflation.
Scottish Mortgage itself has seen its share price nearly cut in half from a peak of 1,558p in November 2021 to 783p as of 6 February 2023.
The investment trust remains significantly up over longer timeframes however, with a five-year return of 83%.
The trust is now managed by Tom Slater and Lawrence Burns following the retirement of long-standing manager James Anderson last April.
When asked for comment on the fall in assets, Baillie Gifford partner Nick Thomas told the Financial Times the business is run with a long-term timeframe and is privately owned, so ‘does not have to worry about short-term fluctuations’.
Thomas added that it is during tough times like this that Baillie Gifford’s partnership structure is particularly advantageous because they can continue investing in the business.