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How Baillie Gifford US Growth Trust smashed the S&P 500 with 24.5% returns by backing private innovators reshaping tech.
This article covers information on Baillie Gifford US Growth Trust PLC.
LON:USABaillie Gifford US Growth Trust has delivered a standout performance, with its share price surging 24.5% in the year to 31 May 2025. This isn’t just a win-it’s a decisive victory over the S&P 500, which returned a modest 7.2% in sterling terms. The trust’s NAV also climbed 22.1%, reinforcing the strength of its high-conviction approach. What’s behind these numbers? A blend of patience, private market access, and positioning at the bleeding edge of technological disruption.
Nearly 35% of the trust’s £780.9 million portfolio is anchored in unlisted companies-a deliberate bet on tomorrow’s giants. Three new private additions joined the roster:
Portfolio turnover remained low at 9.1%, reflecting Baillie Gifford’s trademark patience. As co-managers Gary Robinson and Kirsty Gibson put it: “Success rarely unfolds smoothly. Our focus is on resilient, adaptable companies underpinned by structural growth drivers.”
While private bets drew headlines, the listed portfolio saw shrewd rotations. Five new positions emerged:
Exits included 10X Genomics, Coursera, and HashiCorp-cases where “investment theses didn’t play out as expected.” Notably, managers trimmed NVIDIA and Tesla after their Trump-reflation rallies, recycling capital into fresher opportunities.
Portfolio managers Robinson and Gibson distilled their philosophy into a powerful metaphor: “CEOs are architects. Foundational culture is their steel reinforcement; created culture shapes the daring structures above.” They spotlighted holdings exemplifying this:
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This builder ethos extends across the portfolio-DoorDash expanding beyond food into local commerce, Stripe integrating stablecoins for cheaper cross-border payments, Duolingo using AI tutors to democratise language learning.
The managers see AI’s impact broadening beyond hype cycles: “We’re seeing tangible productivity gains-particularly in software, finance, and professional services.” Their approach spans the AI stack:
Critics might ask: “Why not just buy an S&P 500 tracker?” The retort is sharp: “Indexing gives cheap exposure to incumbents; we back transformers.” The closed-end structure allows pre-IPO stakes in companies like SpaceX and Stripe-impossible for passive funds.
The trust narrowed its discount from 11.2% to 9.4% over the year, buying back 16 million shares (£35.5m). Gearing remains conservative at 4%. No dividend was declared-unsurprising for a capital growth vehicle.
Chair Tom Burnet struck an optimistic note: “Technology reshapes entire industries. Patient capital lets us participate in this transformation.” With AI accelerating and builders thriving amid volatility, Baillie Gifford US Growth seems poised to keep riding America’s innovation wave.
In an era of political noise and tariff tantrums, this trust bets on something more durable: foundational company culture. As the managers note: “America’s greatness is built brick by stubborn brick by founders who see the city not as it is, but as it ought to be.” That’s a thesis worth holding through turbulence.
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