Scottish Mortgage fund manager Baillie Gifford cashes in on Tesla shares to avoid owning too much – after making £13bn in eight months
Savers in a number of Baillie Gifford funds are set to reap a stellar return from its investment in Tesla.
The Edinburgh-based investment management firm, which runs the high profile Scottish Mortgage investment trust and many other popular funds and trusts, has cashed in a chunk of its shares in the electric car maker, generating estimated profits of around £13billion in just eight months.
Baillie Gifford said it was forced to sell the latest round of shares in Elon Musk’s firm last month in order to comply with City rules, which say that stock in one company cannot make up too much of a saver’s investment portfolio.
Baillie Gifford has cashed in a chunk of its shares in electric car maker Tesla, generating estimated profits of around £13bn in just eight months
This is designed to protect investors if the value of that stock suddenly plummets.
But Tesla’s soaring value means Baillie Gifford’s holding has been growing more and more valuable, accounting for an increasingly large proportion of its funds.
Baillie Gifford still owns 4.3 per cent of Tesla, worth around £15billion.
It has sold around half of the shares it held as of the end of December, as Tesla’s share price has shot up almost 500 per cent this year.
But the investment firm has reaffirmed its faith in Tesla, and said it was still ‘very optimistic’ about the firm’s future.