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Should more trusts follow Scottish Mortgage into unquoteds?

A growing number of investment trusts are dipping their toes into unquoted stocks
Should more trusts follow Scottish Mortgage into unquoteds?
  • Scottish Mortgage has significantly increased its exposure to unquoted companies
  • The trust captures growth early and investee companies benefit from long-term funding

Private equity investment trusts have existed for decades. And more recently a number of trusts that focus on listed companies have also started allocating more of their assets to unquoted companies. Notable examples have been Scottish Mortgage Investment Trust (SMT), and other trusts including four also managed by Baillie Gifford are now following its lead.

Annabel Brodie-Smith, communications director of the Association of Investment Companies, says: “Over the last couple of years we have seen several new launches of investment companies targeting fast-growing private companies, along with existing investment companies widening their remit to allocate more of their portfolios to unquoted assets.”

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