Baillie Gifford launches four U.S.-listed active ETFs

Baillie Gifford has launched four actively managed, U.S.-listed equity exchange-traded funds: Emerging Markets (BGEG), International Concentrated Growth (BGCG), International Alpha (BGIA) and Long Term Global Growth (BGGG). BGCG and BGGG were converted from existing mutual funds. The firm announced the launch this week with initial distribution focused on the United States.

The Edinburgh-based asset manager operates as a private partnership and manages about $260 billion in assets. Approximately 40% of those assets come from North American clients.

The ETFs are aimed at U.S. wealth clients and institutional investors, including multi-family offices, private banks and institutions serving high-net-worth investors. Joe Stellato, head of U.S. wealth at Baillie Gifford, explained the firm expanded product formats to respond to client demand and to U.S. tax considerations.

The firm noted the ETF versions follow the same investment strategies used in its mutual funds and separately managed accounts, providing investors access to strategies with longer track records. Baillie Gifford highlighted tax efficiency as a key reason U.S. investors may prefer the ETF structure.

Although the initial rollout targets the U.S. market, Baillie Gifford is in discussions about making the ETFs available in Europe and Asia.

Internal comparisons by the firm indicated a limited number of similar existing ETFs: of 116 ETFs classified in the Emerging Markets sector, 10 were judged to have a comparable profile to Baillie Gifford’s offering, and in the Global Large Equities classification the firm identified five comparable ETFs.

Baillie Gifford is organised as a partnership of 54 partners who work at the firm and has maintained its Scottish investment headquarters for 118 years. The firm presented the ETF lineup as an option for wealth and institutional clients seeking exchange-traded access to its strategies.