The Edinburgh Worldwide Investment Trust (EWIT) has realized nearly a 950% return from its investment in Elon Musk’s SpaceX, making it the trust’s largest holding at about 16% of its portfolio. Managed by Baillie Gifford, EWIT focuses on innovative public and private technology companies, having first invested in SpaceX in 2018. The trust has total assets of £847.15 million ($1.14 billion).
EWIT chairman Jonathan Simpson-Dent highlighted that the initial investment was a “speculative” bet, informed by the portfolio management team’s confidence in Musk’s track record with Tesla, which also brought substantial returns for shareholders. He emphasized that SpaceX, with its focus on rockets and satellites, is considered a transformative company, especially as it develops the Starlink satellite network.
Despite recently downsizing its position in SpaceX, it remains the trust’s largest investment, more than double the size of the next biggest holding. Simpson-Dent mentioned that maintaining a balanced portfolio is crucial, particularly to manage concentration risk, stating that up to 25% of the portfolio can be in unlisted assets.
The SpaceX investment has sparked tensions with EWIT’s largest shareholder, Saba Capital, which holds a 30% stake and has criticized recent sales of SpaceX shares. Saba is calling for board changes to protect shareholder value, while EWIT recommends voting against this proposal at an upcoming meeting on January 26th.
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