Manager behind a Baillie Gifford fund that returned 120% in 2020 gives his outlook

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Tesla CEO Elon Musk speaks at an opening ceremony for Tesla China-made Model Y program in Shanghai on Jan. 7.
Aly Song | Reuters

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The market consistently underestimates the potential of exceptional growth businesses, and by selling disruptive names too early investors miss out on returns. Or at least that's the driving philosophy behind the Baillie Gifford U.S. Equity Growth Fund — which had an outstanding performance record in 2020 — according to the firm's Gary Robinson.

Robinson is one of the portfolio managers of the fund, which returned 120% in 2020 amid strength in holdings like Tesla, Zoom Video and Amazon.

The fund vastly outperformed its benchmark in 2020 — the Russell 2000 Growth gained 36% for the year — as well as 99% of the roughly 1,300 other funds in its category, according to Morningstar. The agency has a five-star rating on the fund, which has returned more than 47% annually over the last three years.

At its simplest, the fund's strategy is to buy and then stick with exceptional growth companies.

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