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Edinburgh Worldwide

Closed-end funds and OEICs
Avantegarde
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Edinburgh Worldwide

#463620

Postby Avantegarde » December 6th, 2021, 7:19 pm

The Edinburgh Worldwide investment trust (run by the hugely successful Baillie Gifford investment partnership) is the current stinker in my portfolio. After a great run in which it had a total return of 241% in the four years to 3/12/2020 it has, in the past 12 months, given a total return of minus 10%. I know the trust's returns are simply a product of the underlying shares, and also its popularity among investors which will affect the discount or premium, but is anyone any the wiser about why the trust's returns have been so poor in the past 12 months?

77ss
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Re: Edinburgh Worldwide

#463696

Postby 77ss » December 7th, 2021, 6:38 am

Avantegarde wrote:The Edinburgh Worldwide investment trust (run by the hugely successful Baillie Gifford investment partnership) is the current stinker in my portfolio. After a great run in which it had a total return of 241% in the four years to 3/12/2020 it has, in the past 12 months, given a total return of minus 10%. I know the trust's returns are simply a product of the underlying shares, and also its popularity among investors which will affect the discount or premium, but is anyone any the wiser about why the trust's returns have been so poor in the past 12 months?


So far, this calendar year, the share price is down by 20%.

I don't pretend to have any clear understanding of why - anymore than than I fully grasp the reasons behind the 88% rise in 2020. No doubt the fact that Tesla has not boomed this year in the way that it did in 2020 will have had an effect.

Final results are due later this month. Reasons/excuses will be given. Can't say that I am that concerned, but I shall read the results with interest.

toofast2live
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Re: Edinburgh Worldwide

#463954

Postby toofast2live » December 7th, 2021, 7:00 pm

tesla did boom. Just not as "boomtastic" as in 2020.

Spet0789
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Re: Edinburgh Worldwide

#463976

Postby Spet0789 » December 7th, 2021, 8:07 pm

Hope you didn’t sell… up 5% today with more to go after the close. Have patience. Bailing on an investment after 12 poor months is a bit daft.

thehaggistrap
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Re: Edinburgh Worldwide

#469222

Postby thehaggistrap » December 30th, 2021, 5:01 pm

Good topic (and a question I have asked myself).

I bought into Edinburgh Worldwide originally because I had been pleased with Scottish Mortgage Trust, another Baillie Gifford fund, but wanted to diversify. Edinburgh Worldwide seems to take similar strategy but apply it to smaller market firms.

Certainly the 12 month performance has been disappointing : if you compare Dec 20 with Dec 21. However : within that time frame the share price has been as high as £4 (and lower than £3!). I guess this is nature of smaller / emerging firms they are invested in. Time required to allow them to grow.

Fwiw : I remain invested and believe patience will be rewarded.

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Re: Edinburgh Worldwide

#473568

Postby Avantegarde » January 16th, 2022, 5:27 pm

Well, it is now the middle of January and EWI is now down about 38% over the past 12 months. That is some fall, even if it is still dwarfed by the rise in the share price in the preceding few years. What bugs me is that there hasn't been a peep from Baillie Gifford about this. The recent half-year report (to the end of October) was silent. The firm's monthly fact sheet gives not even a hint of any explanation. Why? I suppose I could follow all the big firms in the trust's portfolio myself to see what was causing the fall. But I don't want to. That is why I pay the managers their fee, to explain to me what is going on! But so far - silence. Anyone any the wiser?

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Re: Edinburgh Worldwide

#473595

Postby Coobster » January 16th, 2022, 6:15 pm

I have two really poor performing IT's in my portfolio. EWI and JCGI - JPMorgan China Growth & Income.
Early days for me for EWI as I've only owned this IT since June 2020. I expect some volatility but surprised at the poor performance lately. The lack of information / communication is annoying.
The same applies to JCGI - whilst I realise Stock Markets were taken aback by the Chinese Govt. crackdown and that's the reason for the downturn, I haven't found any comments from Jupiter. Perhaps I've missed them? Pretty poor that their communication is so lacking.

Other IT's or funds I hold like MCT - Middlefield Canadian or HG - HG Capital Trust, Blue Whale's Stephen Yiu or Fundsmith's Terry Smith keep you in the loop with their thinking.
Anyway, I'm in there for at least the middle term.

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Re: Edinburgh Worldwide

#473608

Postby monabri » January 16th, 2022, 7:13 pm

AGM 02 February 2022, Baillie Gifford offices, Edinburgh

I wonder what feedback will ensue?

Avantegarde
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Re: Edinburgh Worldwide

#473685

Postby Avantegarde » January 17th, 2022, 8:38 am

monabri wrote:AGM 02 February 2022, Baillie Gifford offices, Edinburgh

I wonder what feedback will ensue?


Thanks for that. I don't normally take an interest in AGMs but I may make an exception for this one. I shall be interested to see if the chairman even acknowledges the slump in the share price, let alone explains it in any detail.

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Re: Edinburgh Worldwide

#473697

Postby Parky » January 17th, 2022, 9:17 am

Look out for comments such as:-
We invest for the long term.
xxx increase over the past 5, 10 years.
Temporary fall in asset value offers opportunities for increasing our investment in Tesla etc.
We believe our strategy is good for long-term growth.
Blah, blah, blah.

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Re: Edinburgh Worldwide

#473864

Postby CrackAddick » January 17th, 2022, 4:58 pm

Coobster wrote:..........
The same applies to JCGI - whilst I realise Stock Markets were taken aback by the Chinese Govt. crackdown and that's the reason for the downturn, I haven't found any comments from Jupiter. Perhaps I've missed them? Pretty poor that their communication is so lacking.
.

I think you meant to say JP Morgan. The 2021 annual report published in Dec did cover some of the underlying issues impacting the trust https://am.jpmorgan.com/content/dam/jpm-am-aem/emea/gb/en/regulatory/annual-report/chinese-ar-web-2021.pdf.

But something else to consider since then, is the impact that a highly contagious variant like Omicron may have in a country like China which still wants too operate a "zero covid" policy and is about to host the Winter Olympics. If Covid gets going, then large parts of their economy may be shut down.

As to EWI, I hold that also and am well down, having been a relatively latecomer. The question I still find myself pondering is whether they were simply "lucky" in that they held a lot of Tech/Pharma investments well suited to a Covid world (hence the trusts outperformance) or are they genuinely good companies that post Covid will still be good companies, but are simply being impacted by the current Value rotation.

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Re: Edinburgh Worldwide

#473876

Postby Coobster » January 17th, 2022, 5:37 pm

CrackAddick wrote:
Coobster wrote:..........
The same applies to JCGI - whilst I realise Stock Markets were taken aback by the Chinese Govt. crackdown and that's the reason for the downturn, I haven't found any comments from Jupiter. Perhaps I've missed them? Pretty poor that their communication is so lacking.
.

I think you meant to say JP Morgan. The 2021 annual report published in Dec did cover some of the underlying issues impacting the trust https://am.jpmorgan.com/content/dam/jpm-am-aem/emea/gb/en/regulatory/annual-report/chinese-ar-web-2021.pdf.

But something else to consider since then, is the impact that a highly contagious variant like Omicron may have in a country like China which still wants too operate a "zero covid" policy and is about to host the Winter Olympics. If Covid gets going, then large parts of their economy may be shut down.

As to EWI, I hold that also and am well down, having been a relatively latecomer. The question I still find myself pondering is whether they were simply "lucky" in that they held a lot of Tech/Pharma investments well suited to a Covid world (hence the trusts outperformance) or are they genuinely good companies that post Covid will still be good companies, but are simply being impacted by the current Value rotation.

Hi CrackAddick, thanks for that, JPMorgan - whatever was I thinking - Jupiter! :o

Thanks for quoting the annual report. I had seen that, it is dated the end of September but the analysis from the Investment Managers is interesting.
JPMorgan do publish the full portfolio and NAV listings every month but unless I'm mistaken you'd have to compare the previous listings to see what has changed.
Yes it will be interesting to see how Covid is managed in China bearing in mind they are supposed to have very few deaths over the last two years in comparison to the size of their population.
Anyway, I'll continue to hold both EWI and JCGI and see what happens over time. I think we might have a bumpy ride on the stock markets this year.

thehaggistrap
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Re: Edinburgh Worldwide

#478425

Postby thehaggistrap » February 3rd, 2022, 8:36 pm

Edinburgh Worldwide Investment Trust AGM.
Douglas Brodie, investment manager of the Edinburgh Worldwide Investment Trust, reflects on the past year, gives some insight into the current positioning of the portfolio and sheds some light on what could be some exciting opportunities in the future.
https://www.bailliegifford.com/en/uk/in ... d-we-1876/

Worrying 2021 for the EWIT share price... which is swept under carpet in video above.

Their argument seems to be that investing in smaller companies requires 5-10 year time scale. Interestingly they want to request that up to 25% of fund can be invested in unlisted companies in the future (current limit is 15%).

EWIT seem to be doing the right thing and investing in interesting opportunities (ITM, Quantumscape, Ocado).
Therefore I remain invested, all be it cautiously.

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Re: Edinburgh Worldwide

#503873

Postby Avantegarde » May 30th, 2022, 11:21 pm

Well, just to complete the picture, I sold all my remaining holding in EWI today, at a price just above that at which I first bought it about two years ago. So, no loss on my total exit, and in fact selling about a third of my original holding last December gained me a noticeable profit, for which I am now grateful. This IT has been the outstanding dog in my portfolio of ITs, falling by nearly half in the past year, and most of that decline has come since the start of 2022. If this was an ordinary company making things or selling a service, people would suspect that the business was in quite big trouble.

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Re: Edinburgh Worldwide

#505183

Postby idpickering » June 6th, 2022, 7:08 am

Edinburgh Worldwide Inv Trust Half-year Report.

Since 1 February 2014, the Company has been invested in a diversified portfolio of companies which individually offer significant long term growth potential and typically have a market capitalisation of less than US$5bn at the time of initial investment.

Over the six month period, the Company's net asset value per share decreased by 34.1% while the comparative index* decreased by 6.8%. The share price fell by 38.5%. Over the five year period, the Company's net asset value per share increased by 80.7% while the comparative index* increased by 40.7%. The share price increased by 79.1%.

The past six months have been a been a challenging one for stock markets. This has been most acute for those listed companies where their commercial activities have yet to scale and consequently their profits skew to outer years. The stocks favoured by the Company have been in the eye of the storm.

Of the stocks held in the portfolio, 19 generated positive absolute returns in sterling terms over the six months to end of April. Conversely, 35 stocks fell more than 50%.

During the period, the Company issued 550,000 shares and bought back and held in treasury 3,525,695 shares. Since the period end to 31 May 2022, a further 3,192,854 shares have been bought back and held in treasury.
The net revenue return per share was a negative 0.23p (six months to 30 April 2021: negative 0.31p). No interim dividend is being recommended.

As at 30 April 2022 the Company's investment in unlisted companies was 19.3% of total assets (30 April 2021: 7.9%).

The current aggressive sell off (including that since 30 April 2022) is more synonymous with growth being mistakenly viewed as an intrinsic fragility within a business. For companies where the growth potential largely sits outwith the influence of macro trends and geopolitics this seems both odd and short sighted, but ultimately a source of investment opportunity for the future.


https://www.investegate.co.uk/edinburgh ... 00086709N/

Ian.

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Re: Edinburgh Worldwide

#505194

Postby AWOL » June 6th, 2022, 8:08 am

CrackAddick wrote:
Coobster wrote:..........
The same applies to JCGI - whilst I realise Stock Markets were taken aback by the Chinese Govt. crackdown and that's the reason for the downturn, I haven't found any comments from Jupiter. Perhaps I've missed them? Pretty poor that their communication is so lacking.
.

I think you meant to say JP Morgan. The 2021 annual report published in Dec did cover some of the underlying issues impacting the trust https://am.jpmorgan.com/content/dam/jpm-am-aem/emea/gb/en/regulatory/annual-report/chinese-ar-web-2021.pdf.

But something else to consider since then, is the impact that a highly contagious variant like Omicron may have in a country like China which still wants too operate a "zero covid" policy and is about to host the Winter Olympics. If Covid gets going, then large parts of their economy may be shut down.

As to EWI, I hold that also and am well down, having been a relatively latecomer. The question I still find myself pondering is whether they were simply "lucky" in that they held a lot of Tech/Pharma investments well suited to a Covid world (hence the trusts outperformance) or are they genuinely good companies that post Covid will still be good companies, but are simply being impacted by the current Value rotation.


If inflation is transitory then the value rotation will probably end and growth will shine otherwise Baillie Gifford funds will continue to underperform. The second factor is will Chinese policy continue to impede the Chinese investments. The first of these issues is the dominant one but both are required to have a good view on EDI's future outlook.

Personally i think there is a real possibility that inflation will persist, many of the government's are following policies that are popular but demand inflationary (in response to supply side inflation) this looks risky to me but this is purely an opinion.

It is worth remembering the days when value funds were the only sensible choice and when they fell from grace commentators for some time afterwards would point at their long term returns and say "only a fool would bet against them and they will be back as value outperforms in the long term" and "growth is buying high, it is obvious that buying low will outperform". This is what goes through my mind when the newspapers say that BG trusts are cheap, buy the dip.

As for China, the risks of both planned war and accidentally starting one by a pilot or captain being too aggressive and China being unable to lose face by backing down are real.

Ultimately my crystal ball is cloudy so I suggest that being style neutral and spreading risks is sensible.


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