Baillie Gifford managers cut gearing on muted UK outlook

The managers of two Baillie Gifford investment trusts have significantly slashed gearing in the view growth prospects in the UK market are subdued for the rest of the year.

The £1.2bn Monks investment trust, headed up by Baillie Gifford CIO Gerald Smith, has reduced gearing from 108% to 92%. Meanwhile, Michael MacPhee, manager of the £72m Mid Wynd International trust, has cut gearing from 108% to 92%. A spokesperson for Baillie Gifford said both trusts sold out of FTSE 100, S&P 500 and Euro Stoxx 50 index futures to help protect assets against any significant fall in market values. “Both managers have a degree of caution at the moment. Inflation worries and sovereign debt issues cloud the UK market in the short term, in their opinion,” said the spokesper...