Wednesday, 19 September 2018

Edinburgh Worldwide - New Purchase


As part of a move from income to growth following a strategy review earlier this year, I have recently added this global managed investment trust to my SIPP portfolio. (NB not to be confused with the UK income trust Edinburgh IT managed by Mark Barnett)

The trusts is part of the Baillie Gifford stable which also includes Scottish Mortgage. It has been managed by Douglas Brodie since 2014.

The focus is very much on global smaller companies with an initial market cap. under $5 billion. The trust is widely diversified and at any point the typical portfolio will hold between 75 - 125 holdings in a minimum of 15 sectors and from at least 6 different global markets.

The current portfolio is weighted in favour of biotech, pharma and technology stocks which account for around 60% of the portfolio. No doubt the manager is influenced by the much larger Scottish Mortgage trust and will be looking to invest in similar types of stocks but at an earlier stage of their growth.

The strategy has paid off in recent years with returns exceeding the global smaller companies index and the share price moving from discount to a small premium. Over just the past 2 years the share price has increased by over 100% from 490p to 994p at the time of posting.

3 Yr Comparison v SMT (click image to enlarge)

As with my initial purchase of SMT in January 2017, it can be difficult to 'buy the dips' when a share price is rising quickly so I have taken the plunge and hope there will not be a significant pull back over the coming months. My Scottish Mortgage acquisition is currently up 60% since purchase so I can afford to be a little more relaxed with this one.

Full year results to end October should be available in early December.

As ever, this article is merely a record of my personal investment decisions and should not be regarded as an endorsement or recommendation - always DYOR!

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