Report Card: After a bumper year, is Scottish Mortgage a good buy now?


#1

Originally published at: https://whichinvestmenttrust.com/report-card-after-a-bumper-year-is-scottish-mortgage-a-good-buy-now/

The world’s largest investment trust has had a terrific year, with portfolio returns of +25% to add to an already outstanding long term track record, but if you don’t already have a holding, have you missed the boat or are there still opportunities to be had here? Fast Facts World’s largest investment trust Annual results…


#2

I think you are right about the culture at Baillie Gifford being one of the reasons for the good long term performance.

I have heard a lot of people complaining that its good run will end soon, but you have set out a pretty good argument for why it won’t, which i subscribe to too.


#3

The top 10 accounts for 54% - wow, that’s concentrated. In the video James Anderson predicts that Amazon and Alibaba will be valued at over $1 trillion, he’s got real belief in those 6 long term winners they talk about in the article. If he is right there is a lot more to come back to shareholders in Scottish Mortgage.

My holding in Scottish mortgage is quite small, I’m weighing up increasing it, but it’s on a big premium today. Not sure I wanna pay that.


#4

I don’t think a couple of a per cent premium will make much difference to your profit in Scottish Mortgage @harjinder Slater and Anderson’s stock picking skills is what should really matter here.


#5

Is it good stockpicking or simply that in opting to back ‘disruptors’ they made a strategic bet that paid off? Because that could be down to luck! Now, I think it very much comes down to whether you believe in the prospects of the big tech companies. Will they ever justify their PE ratios? On my wall I have share certificates from the 1800’s in the Regents Canal company, the Great Ship company, and Overend Gurney who were banking backers for the railway boom. All hot, hot stocks. All gone. Now, the certificates are worth more!


#6

They’ve been at it for 18 years now @mickbeaman though it wasn’t outperforming to the same extent in the early years. What I like about SMT and the article captures is how Anderson and Slater emphasise the long term, focusing on 5-10 year numbers rather than the 1-3 numbers journalists like to write about but which aren’t to important to me as a long term investor.

I don’t think a manager can maintain good performance like this without being a good stock picker.


#7

SMT has returned 328% in 10 years @harjinder a per cent or 3 premium won’t matter much in ten years time. In fact it would have very little impact because you will be benefitting from compounding returns - remember the supposed 8th wonder of the world.

I would go for it.


#8

Personally, I don’t think that the record proves anything in itself. The story of the monkeys on Wall Street refers. Take a group of monkeys and get them to ‘select’ stocks by sticking a pin in the lists in the WSJ. Next day, repeat but only using the monkeys whose selection best the market. Then repeat again. Eventually you have one monkey left, the genius who had beaten the market every day…


#9

I should have added, hence my profile pic!


#10

Clever @mickbeaman! That story is new to me.