Baillie Gifford has formally launched a lower volatility version of its £4.3bn Managed fund.
The Baillie Gifford Cautious Managed fund has a higher allocation to bonds and therefore a lower weighting in equities than the flagship fund to maintain a lower volatility profile.
The new fund has a benchmark of 50% in equities, 45% in bonds and 5% in cash and sits in the IA’s 20% - 60% Mixed Investment Sector, compared to the Managed fund which has a base allocation of 75% equities, 20% bonds and 5% cash and is part of the 40% - 85% sector.
Head of UK equities Iain McCombie and head of income research Steven Hay will run the new mandate alongside the original fund.
Early investors can benefit from a discounted management fee with a 30% saving on B shares for the first three years and a 0.4% annual management charge thereafter, in keeping with the Managed fund. Y share class investors investing over £10m in the first 6 months will retain the discount in perpetuity.
James Budden, head of global marketing, said: “Our new Cautious Managed fund complements the well-known Baillie Gifford Managed fund which has been in existence for nearly 40 years.
“Our research has convinced us that there is demand for a less volatile managed option. It is the same team at the helm and the same successful process still offering the best of Baillie Gifford’s equity and bond ideas but blended differently. Another difference is the fee being 0.28% versus 0.40% during the initial period.”
