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Baillie Gifford Japan Trust PLC
Launched in January 1981, the Baillie Gifford Japan Trust aims to provide capital growth by investing primarily in Japanese small and medium-sized companies, which offer exceptional growth opportunities with sustainable business models. It is run by the same team behind the Elite Rated Baillie Gifford Japanese fund, whose track record is among the best in the business.
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Matthew is an investment manager in the Japanese Equities Team at Baillie Gifford, where he has worked since 2003 and became a partner in 2018. He manages the Japanese Fund and related All Cap Strategy segregated accounts, the Baillie Gifford Japan Trust, and co-manages the Japanese Income Growth Fund. Matthew graduated with a BA (Hons) in Natural Sciences (Psychology) from the University of Cambridge in 2000 and holds a PhD in Psychology from the University of Bristol.
Praveen is an investment manager in the Japanese Equities Team at Baillie Gifford. He manages the Japanese Smaller Companies Fund, related Japan Small Cap Strategy segregated accounts, and the Shin Nippon Investment Trust Plc, and is the deputy manager of the Japan Trust Plc. He is also a founder and member of the International Smaller Companies Portfolio Construction Group. Prior to joining Baillie Gifford in 2008, Praveen worked at FKI Logistex. He graduated with a BEng in Computer Science from Bangalore University in 2001 and completed an MBA at the University of Cambridge in 2008.
Matthew is an investment manager in the Japanese Equities Team at Baillie Gifford, where he has worked since 2003 and became a partner in 2018. He manages the Japanese Fund and related All Cap Strategy segregated accounts, the Baillie Gifford Japan Trust, and co-manages the Japanese Income Growth Fund. Matthew graduated with a BA (Hons) in Natural Sciences (Psychology) from the University of Cambridge in 2000 and holds a PhD in Psychology from the University of Bristol.
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Quote from the Fund Manager
We like quality businesses that can show secular earnings growth over time.
Matthew Brett
Lead Manager
Investment process
The Baillie Gifford Japan Trust and Baillie Gifford Japanese fund have a similar investment process. The investment team, headed by Matthew, seeks to identify well-managed businesses with a strong competitive advantage, which are not overpriced. The research process is designed to ensure that the best ideas from each individual team member are included in the portfolio, rather than a ‘lowest common denominator’ approach, which can result from team-based investment. The trust will typically consist of 40-70 stocks, with a focus on smaller and medium-sized companies, which are believed to have above average prospects for growth. The trust began paying a dividend in 2018.
Risk
As this trust invests mainly in small and medium-sized companies, the portfolio can experience some volatility. Currency fluctuation is another risk that investors need to be aware of. Investors comparing the Baillie Gifford Japanese fund and the Baillie Gifford Japan Trust should note that the trust has tended to be more volatile than the open-ended fund over the long term. This is down to the gearing that is employed. However, this has also enhanced the trust’s total returns over the long term.
ESG
ESG - Limited
With this trust, Matthew takes a long-term approach, looking for growth opportunities with firms that are likely to be future leaders. He believes that this long-term approach incorporates a natural bias towards sustainable business models, however this is not a formal policy of the philosophy or process. Material ESG issues that are identified in the analysis will be considered as possible reasons to not invest, but this will be on a case-by-case basis, rather than a systematic approach. There is a strong focus on governance though, with Matthew and the team having regular engagement with the management of companies already held in the fund and those of prospective holdings.
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