Baillie Gifford Cuts its Tesla Stake by Half

Posted by on

Baillie Gifford, the Scottish investment manager has sold half of its take in electric car market Tesla(TSLA), according to an article at CityWire, UK. BG was the largest institutional investor in Tesla with holdings of about 40 million shares or about 8% of the company at one time last year. It is not surprising that BG has decided to lock in the gains since they started buying shares when they were $6 many years ago. Since then the stock has sky-rocketed with a 695% return in 2020. This year the stock has increased from under $730 in January to close at $816 on Friday.

On Feb 8th, Tesla announced as investment of $1.5 billion in bitcoin. Some market participants have wondered if this is a wise strategy for the firm. In addition, last week Musk’s brother Kimbal Musk sold $25 million worth of Tesla shares. Now with BG paring down their investment some investors may be wondering if the top is already in for the electric car marker’s stock.

From the article at CityWire, UK:

Baillie Gifford has slashed the size of its holding in Tesla, the Elon Musk-led electric vehicle company which was its highest conviction bet and biggest driver of returns last year.

The Edinburgh-based asset manager has halved the weighting in both Scottish Mortgage (SMT), the UK’s largest investment trust, and Baillie Gifford US Growth (USA), the best-performing trust last year.

The trusts’ positions in Tesla grew significantly after its nine-fold share price leap in 2020, and after taking some profits, USA’s exposure has fallen to 4.4% from 8.7%.

Other Baillie Gifford funds have yet to report their latest portfolio weightings, but seem likely to have followed suit. Having been Tesla’s largest external investor a year ago with a 7.7% stake, Edinburgh-based Baillie Gifford cut its exposure to 2.8% at the end of December, ranking it Tesla’s fifth biggest shareholder, including Musk who owns 18%, according to Refinitiv data. This was down from Baillie Gifford’s 4.4% position in September.

According to Scottish Mortgage’s latest factsheet, first reported by Fund Hunter on Twitter, Tesla was a 5.1% position, the fourth biggest in the global portfolio at the end of January. This was cut from 8.9% at the turn of the year when it was still its top holding by a significant margin.

Source: Baillie Gifford halves Tesla holding to lock in huge gains, CityWire UK, Feb 15, 2021

Related:

Disclosure: No Positions

The Top 10 Emerging Markets Equity Returns From 2001 To 2020: Chart

Posted by on

The Top 10 Emerging Markets Equity Returns based on MSCI from 2001 to 2020 are shown in the chart below. South Korea was the top performer due to the boom in tech stocks last year. Samsung for example is the largest constituent in the country’s benchmark KOSPI Index. South Korean chip and electronic firms also helped push returns higher for the year. The next top ranked emerging market was Taiwan. Similar to South Korea, Taiwan also benefitted immensely from the demand for computers, tablets, chips, etc. Among the major emerging countries, China had the best returns as the economy grew strongly with the country successfully controlling the coronavirus.

Click to enlarge

Data Sources: MSCI. Data for individual countries from 2000 through 2001 came from MSCI Price Indices, which measure market price performance only.

Source: Lazard Asset Management

Related ETFs:

  • Market Vectors Russia ETF (RSX)
  • iShares MSCI South Korea ETF (EWY)
  • iShares MSCI Turkey ETF (TUR)
  • iShares MSCI Taiwan ETF (EWT)
  • iShares MSCI India ETF  (INDA)
  • iShares MSCI Emerging Markets ETF (EEM)
  • Vanguard MSCI Emerging Markets ETF (VWO)

Disclosure: No Positions

The Top 50 Most Valuable Latin American Brands 2020

Posted by on

The Top 50 Most Valuable Brands in Latin America for 2020 is shown in the graphic below. The most valuable brand in the continent is Brazilian banking group Bradesco(BBD). Corona beer is the top brand in Mexico. In Peru, BCP bank (BAP) is among the top 3 brands. Similarly in Colombia, Bancolombia(CIB) is also a top 3 brand.

Click to enlarge

Source: Brandz

Disclosure:  Long BBD

How Democratic is your Country?: Infographic

Posted by on

The following graphic shows the rating of countries based on the latest Democracy Index by The Economist Intelligence Unit. Most of Africa are authoritarian regimes. Same for most of the Middle East, Russia and China. Some of the major countries are classified as flawed democracies. These include Brazil, India, Italy, France and the US.

North Korea ranks the last in democracy for obvious reasons. And the most democratic country is Norway followed by Iceland and Sweden.

Click to enlarge

Source: RFE/RL Infographic

Market Caps of the Five Top Tech Stocks Have Soared Since 2013

Posted by on

Technology stocks are on a tear the past few years. In 2019, the NASDAQ index rose over 35%. With the arrival of the pandemic in 2020, the NASDAQ shot up again by over 43%. It remains to be by much it will grow this year.

The top five companies – Facebook(FB), Apple(AAPL), Amazon(AMZN), Microsoft(MSFT) and Alphabet(GOOG) –  leading the index have steadily grown their market capitalizations since 2013 as shown in the graphic below. From $1.13 Trillion in total market cap at the end of 2012, these five giants’ market cap reached an astonishing $7.5 Trillion at the end last year.

To put this number in perspective, the US GDP was estimated be over $21.0 Trillion in 2020. So just these five firms have a market value of one-third of the US GDP ! And the expectation is they would continue to rise even further.

 

Click to enlarge

Source: How Big Tech Got Even Bigger, WSJ

Much of the growth in recent years has come from P/E expansion as investors bet on potential growth in the future. For example, Apple’s P/E of around 37 is much higher than what it was three years go. Currently Apple(AAPL) has a market cap of $2.3 T.

Facebook’s P/E is over 26 while Amazon’s stands at an astonishing 80.Microsoft is no longer cheap either with a P/E of over 36.

Disclosure: No Positions