苏格兰抵押投资信托 — 经理人回顾，截至2013年3月31日年报（詹姆斯·安德森与汤姆·斯莱特）

We made few changes to your portfolio in 2012/13. We still own all of the top thirty holdings of a year ago. Market movements accounted for the bulk of the changes in the rankings of these stocks. Overall turnover has been little over 10%. Whilst equity markets have generally moved forward over the year it has been a frustrating period for patient investors looking for strongly growing companies. Our approach will not change but there is little sign that the markets are willing to abandon their preoccupation with alternating waves of macroeconomic and political hope followed by renewed angst. In the terrible but revealing jargon of our time this is presented as 'risk on' or 'risk off' with risk defined as short term share price volatility. Any serious assessment of the long-run competitive prospects of individual companies appears unlikely at the current juncture.

Whilst our portfolio is built upon the attractions of individual companies we think that the opportunities available to us are in turn moulded by the dominant forces in the global economy. For several years now we have believed that three factors are especially critical:

• The rise of China (and to a lesser extent other emerging

economies). The underestimated power of structural technological change. The flaws of the Western financial system. We see no imminent reason to amend this framework. Our Core Investment Beliefs as set out in last year's Review are eiterated in the section following the California Note. China t is on this topic that we find ourselves most out of sympathy with current market sentiment. The disdain shown to Chinese equities wherever they may be listed) is but part of a sustained and continuing antipathy towards the stocks of all the major emerging narkets.

Brazil, Russia and India have been similarly unpopular. This is an extraordinary contrast with the mood five years ago when the BRIC countries were perceived to be the saviours of the global economy. Whilst we share some disillusion with the current progress of Brazil, India and Russia we have long believed that China is in a class apart. This conviction has grown rather than shrunk over the last year. Growth has migrated from exports to domestic demand and from the coasts to the underdeveloped leartlands. Wages have risen as has productivity. Inflation is subdued. Naturally further progress is needed in several areas rom corruption to pollution but the underlying transformation has been impressive. We cannot expect China to grow at 10% per annum as it has in the past. We do not want it to do so with the dramatic export surpluses of that era.

The current trend of 7% growth and burgeoning import demand contribute far more to the nealth of the global economy than the unbalanced and immature boom of the past. The future drivers of the Chinese economy are reflected in the portfolio. As imports have grown we have maintained significant exposure to international companies that have the skills and vision o enable them to flourish in China. PPR's luxury goods have been a major beneficiary of the conspicuous consumption of the newly vealthy Chinese consumer but broad gains in disposable income nave opened up prospects for classic middle class purchases. This has made China fertile ground for the superb business model of Inditex in which we now have a larger holding. In such ways does the Chinese consumer aid even the rural economy of bedraggled Spain. Clusumpiods company, a beneficiary of Chinese consumer We remain most excited by the opportunities surrounding the Chinese internet.

This was the specific area in which we have been most out of step with the market mood in the last year. In particular Baidu's share price has been extremely weak. As it began the year as our largest holding this has obviously had a substantial impact on our NAV. We do not intend to retreat from our belief in the company and its management. Baidu has been investing heavily in replicating its dominance of desktop search in the booming mobile business. This seems to us to be very sensible. It has been characteristic of the last year that equity markets are deeply intolerant of any investment spending by companies that crimp immediate profit growth. We find this both remarkably short term even by recent standards and deeply disturbing in its implications for corporate behaviour and the global economy.

In the course of the year we have participated in a placing of unquoted convertible preference shares in Alibaba. This is China's dominant e-commerce enterprise. On its peak trading day last year Alibaba's gross merchandise volumes ran at double that of the entire US e-commerce sector on Cyber Monday. Alibaba too will continue to invest fearlessly and admirably. Its reticence about a full IPO reflects both this characteristic and its strong cash-flows. Technology We are appending a note by Tom Slater describing his extended stay in Silicon Valley last autumn. It describes areas of potential interest in the future. It may be worth adding a few words on current developments. Here too the dominant characteristic is extreme impatience and intolerance of even the most modest and temporary halt in earnings gratification. Thus we have seen the rise and dramatic fall of Apple (with a loss approaching $300bn in capitalization over the last seven months) although it is hard to see that tuture prospects have changed substantively.

Such a pattern has been replicated from the high-profile lurches in Facebook's share price to similar but less heavily observed gyrations in cloud-computing company Rackspace. The only surprise is that Amazon has thus far avoided such dramatic share price swings (albert with quite sufficient volatility around results). This is remarkable as Amazon is more dedicated to the pursuit of much deferred rewards than any other quoted company in our experience. It is possible that it has a shareholder base that tries to match this pleasing perspective. The greatest encouragement of the year has been the continued progress in genomic science. Prices for sequencing continue to plunge, diagnostic improvements are following and gradually health systems and pharmaceutical behemoths are adjusted to a new world. Illumina continues to lead this technology. We are oleased it has preserved its independence.

Western Financial Flaws There is little sign that banks have become less complex, less greedy or less dangerous. Management modesty remains rare. Regulatory changes have been piecemeal and hardly distinguished by their own simplicity. All we are left with is the nope that the combination of the savage lesson of 2008/9 and a gradual push for more equity within the banks has dampened the mminent threats. Over the last year more attention has been paid to the flaws of government finances than those of banks. At times conventional nterpretations appeared lacking in common sense. It has always seemed improbable that the ECB and Germany were willing to walk away from the continued existence of the euro. That it was believed to be so appears to us to owe more to the lurid maginings of the London establishment than to serious analysis.

Equally it is becoming increasingly probable that the gospel of austerity that has so appealed to so many in conservative financial and political sectors is self-defeating in practice. That it appears nistorically and evidentially questionable is becoming increasingly obvious. Structural reform accompanied by the pursuit of growth ather than consolidation appears the appropriate policy in almost all the developed world. The greatest encouragement of the year has been the continued progress in genomic science. Conclusion Although the last 12 months have seen a modest improvement in stock markets the atmosphere remains acutely nervous and confidence low. Only those stocks and those countries perceived to be the safest and most stable have enjoyed consistent rallies. Even in America politics and economic data points continue to fray emotions. The corporate sector has as yet proven unwilling to re-invest its extraordinary cash riches - perhaps unsurprisingly given the suspicion investors have shown when any such ambitions have been mooted.

At the same time prior optimism about emerging markets has been leeched away by the drip-drip of underperformance and redemptions. Yet all this seems to neglect substantial improvements. America is recovering - however inelegantly. The risk of extreme outcomes in Europe has been shown to be lower than once feared. China has transformed itself and in doing so assisted the global economy. Above all there are truly great, growing and sustainable companies available to us at alluring prices. Eventually this will matter. James Anderson Manager of Scottish Mortgage 10 May 2013 Alibaba Group China's dominant e-commerce enterprise. Inditex Zara High Street Store. Tencent Atlas Copco Tencent's 'WeChat' logo. Swedish engineering excellence. Intuitive Surgical Continued advance in diagnostic technology and robotic surgery techniques. Our portfolio is built upon the attractions of individual companies. California Note The model of capitalism that exists on the West Coast of the United States has produced several of the largest holdings in our portfolio.

I spent the autumn there visiting existing holdings, thinking about the emerging technologies and meeting early stage companies that may become significant in future years. Despite the efforts of many imitators, the San Francisco Bay Area remains the most important centre for the generation and growth of new technology companies. The influence of such companies is increasing rapidly in both geographic reach and economic impact. The personal computer reached the upper income tier of the developed world. Over the coming decade, computers in the form of smartphones are likely to be in the hands of billions of users. This level of ubiquity transforms the opportunity set for those that can harness the technology. It is not just the scale of this change that is impressive. The way consumers access nternet services is moving at astonishing speed. It is plausible that within the next two years the majority of access will be from mobile devices.

Today in the Western world there are four dominant platforms in the consumer internet: Amazon, Google, Facebook and Apple. We currently own shares in all of them. Whilst a lot is written in the media about the skirmishes between these companies, it appears o us that their core businesses encounter limited competition. They are growing rapidly. Their management teams have thus far been highly successful in navigating the shift towards mobile access and it seems no coincidence that three of the four are run by their founders. From IBM to Microsoft to Hewlett Packard to ntel it is striking that long periods of dominance in technology have coincided with the reigns of founder-managers. In the consumer internet in particular, having a CEO who is very close to product development seems likely to be a critical factor as user behaviour continues to evolve so quickly.

Spending time with some of the area's venture capitalists provided a perspective on some of the most interesting areas of early stage nvestment. In general the companies they are investing in build on op of the big four consumer platforms. This allows them to minimise development costs and also to acquire users rapidly. nstagram, a mobile photo sharing service recently acquired by Facebook, provides an example. Prior to acquisition, its user base grew from 10m people to 30m in six months. It served these users with just 13 employees and a modest amount of capital. This profile isn't unusual for a breakthrough consumer internet service. E-commerce E-commerce remains an area of active interest for early stage unding and new business models are emerging. However there seems little that might challenge the dominance of Amazon in the distribution of any item with a universal product code.

Amazon's eputation for investing large sums of money over long periods of ime in order to reinforce its dominance has informed the behaviour of the venture capital community, which is unwilling to und direct competitors. Instead the new generation of e-commerce companies are finding other ways to serve customers. They are designing and sourcing their own goods. Dften they are collapsing inefficient legacy supply chains by cutting out intermediate layers. They are re-inventing physical etail merchandising online and developing alternative ways of distributing their products. It seems very unlikely that there will be any let-up in the assault on high-street retail anytime soon. Payments A variety of venture-funded companies are seeking to reinvent the way we pay for goods and services. The underiying idea is that if mobile computing devices become widespread, consumers may use online methods to pay for goods in the offline world.

This would be attractive to retailers as it would give them more information about their customers and allow them to better target their advertising budget. However, the user experience of swiping a payment card is straightforward and well understood. To change behaviour, the key will be providing sufficient incentive. Several ideas are being pursued, the most promising of which seems to me to be the elimination of physical checkout and the associated queues altogether. Through our holding in eBay we currently have exposure to the largest online payments business in the world, PayPal. This is a remarkable business which has continued to grow rapidly despite its already significant scale and a relatively lackluster pace of product development. The huge investment in infrastructure that has been required to get PayPal to its current base of 120m users in 190 countries now represents a significant asset and a major hurdle for new players.

Following a change in leadership there seems to be a marked acceleration in the pace of product development at PayPal. This leaves it well placed to benefit from future growth in its addressable market despite the emergence of new and innovative competition. Enterprise The technologies that have been created by the recent wave of innovation in consumer internet are being adapted and developed for the enterprise marketplace. The latest consumer websites are driven by software architecture and interfaces that have great potential in a corporate setting. Whilst most of the existing enterprise software companies are built around providing systems of record in areas such as accounting or human resources, the next generation of businesses are utilising the data that exists outside of such a structured environment. Inexpensive storage techniques mean that huge volumes of data can be retained and the technologies to make the most of this information are starting to emerge.

Typically, Amazon has been at the forefront of understanding the implications of these changes. It is now commonplace for new technology companies to outsource their computing infrastructure to Amazon rather than investing in servers or data centres. Similarly, Rackspace is rapidly becoming the world's largest IT department providing an outsourced service for those companies that no longer want such distractions. The historic core functions of enterprise software are also being challenged by companies employing more modern approaches. Workday was founded in 2005 by the former management of Peoplesoft and listed on the stock market recently. Its centrally- hosted software is accessed via a webpage to deliver accounting and human resources systems. Centralisation allows for much greater efficiency. Because all users are running the latest version of the software, support costs are lowered and development cycles are shortened. Salesforce.com has achieved a similar feat in customer relationship management and is trying to broaden the application of its software to manage online marketing.

Electricity - using existing resources to increase efficiency. Healthcare Healthcare seems like an industry ripe for disruption through innovative technology. However the regulatory environment and unionised workforce are off-putting to the venture capitalist community, which creates a difficult funding environment for start-ups. Whilst Intuitive Surgical is nominally a healthcare company, it is headquartered in Silicon Valley, its research and development is lead by an engineer, not a doctor, and its robots run over a million lines of software code. To date, these instruments have employed artificial intelligence to recreate open surgery using minimally invasive techniques. The future might look quite different. Developments in diagnostic technology mean that clinical targets will get smaller. Targeting nerves or vessels will require precision beyond the abilities of most human surgeons. Equally the ability to distinguish between different tissue types can be beyond the scope of the human eye and new visualisation techniques are required.

Over the coming decade we should anticipate that these technologies will expand the realm of what is surgically possible. Electricity Consumption Whilst much of the innovation we invest in is implemented by software companies, there are exceptions. The efficiency with which computers use electrical power has been doubling every eighteen months for the past sixty years equating to a 100-fold improvement every decade. It is this progress that has enabled laptop computing and subsequently the smartphone market. If a modern-day MacBook Air operated at the energy efficiency of computers from 1991, its fully charged battery would last 2.5 seconds. In recent years, the contribution of one of our holdings, ARM, to microprocessor designs has been increasingly important to this trend. Its designs are used in over 90% of mobile phone handsets as they offer the best trade-offs between performance and power consumption.

Their technology continues to drive down power requirements and the implications of this progress continuing are fascinating. University laboratories are already producing sensors that use 60 microwatts when active. In metropolitan areas, this amount of power can be harvested from ambient radio and TV signals. Without the need for batteries you get sensors that run indefinitely. Such distributed computing power could significantly reduce our energy consumption by increasing the efficiency with which we use existing resources. We are continually trying to improve our investment approach. Whilst we base ourselves in Edinburgh, in part to get away from the noise and compulsion to act that are present in major financial centres, spending time in the parts of the world that are producing great companies is a fabulous opportunity to learn. We are told by the efficient market theorists that future outcomes are down to chance and the best we can hope for is to diversify our portfolio.

Engaging with the entrepreneurs who are out there creating value by building new companies reveals a very different view of the world. They don't leave things to the chance outcomes of normal distributions and believe that they must build the future for themselves. Most will fail (experimentation and failure is a badge of honour) but the returns that accrue to the winners can be very large. Our belief is that by developing our knowledge of the potential winners at an earlier stage of their development cycle we will be able to do a better job at investing in them for our shareholders in the future. Tom Slater Deputy Manager of Scottish Mortgage 10 May 2013 Our Core Investment Beliefs Whilst fund managers claim to spend much of their careers assessing the competitive advantage of companies they are notoriously reluctant to perform any such analysis on themselves.

The tendency is to cite recent performance as evidence of skili despite the luck, randomness and mean-reverting characteristics of most such data. If this does not suffice then attention turns to a discussion of the high educational qualifications, hard work and exotic remuneration packages that the fund manager enjoys. ; Sometimes the procedural details of the investment process are outlined with heavy emphasis on risk controls. Little attention is given to either the distinctiveness of the approach or the strategic advantages the manager might enjoy in order to make imitation improbable. We think we should try to do better than this.

• We are long term in our investment decisions. It is only over

periods of at least five years that the competitive advantages and managerial excellence of companies becomes apparent. It is these characteristics that we want to identify and support.

We own companies rather than rent shares. We do not regard ourselves as experts in forecasting the oscillations of economies or the mood swings of markets. Indeed we think that it is hard to excel in such areas as this is where so many market participants focus and where so little of the value of companies lies. Equally Baillie Gifford is more likely to possess competitive advantages for the good of shareholders when it adopts a long term perspective. We are a 100 year old Scottish partnership. We think about our own business over decades not quarters. Such stability may not be exciting but it does encourage patience in this most impatient of industries. We only judge our investment performance over five year plus time horizons. In truth it takes at least a decade to provide adequate evidence of investment skill.

• The investment management industry is ill-equipped to deal

with the behavioural and emotional challenges inherent in today's capital markets.

Our time frame and ownership structure help us to fight these dangers. We are besieged by news, data and opinion. The bulk of this information is of little significance but it implores you to rapid and usually futile action. This can be particularly damaging at times of stress. Academic research argues that most individuals dislike financial losses twice as much as they take pleasure in gains. We fear that for fund managers this relationship is close to tenfold. Internal and external pressures make the avoidance of loss dominant. This is damaging in a portfolio context. We need to be willing to accept loss if there is an equal or greater chance of (almost) unlimited gain.

• We are very dubious about the value of routine information.

We have little confidence in quarterly earnings and none in the views of investment banks.

We try to screen out rather than incorporate their noise. In contrast we think that the world offers joyous opportunities to hear views, perspectives and visions that are barely noticed by the markets. From our office in Shanghai to futurists in California there is more in the investment world than the Financial Times or Wall Street Journal describe.

• We are global in stock selection, asset allocation and

attribution. We are active not passive - or far worse - index plus in stock selection. Holding sizes reflect the potential upside and its probability (or otherwise) rather than the combination of the market capitalization and geographical location of the company and its headquarters. We do not have We are Growth stock investors. sufficient confidence in our top-down asset allocation skills to wish to override stock selection. We do not have enough confidence in our market timing abilities to wish to add or remove gearing at frequent intervals.

We do, however, have strong conviction that our portfolio should be comparatively concentrated, and that it is of little use to shareholders to tinker around the edges of indices. We think this produces better investment results and it certainly makes us more committed shareholders in companies. We suspect that selecting stocks on the basis of the past (their current market capitalization) is a policy designed to protect the security of tenure of asset managers rather than to build the wealth of shareholders. Companies that are large and established tend to be internally complacent and inflexible. They are often vulnerable to assault by more ambitious and vibrant newcomers.

• We are Growth stock investors. Such has been the preference

for Value and the search to arbitrage away minor rating differentials that investors find it very hard to acknowledge the extraordinary growth rates and returns that can be found today.

The growth that we are particularly interested in is of an explosive nature and often requires minimal fixed assets or indeed capital. We think of it as 'Growth at Unreasonable Prices' rather than the traditional discipline of 'Growth at a Reasonable Price'. We need to be willing to pay high multiples of immediate earnings because the scale of future potential and returns can be so dramatic. On the stocks that flourish the valuation will have turned out to be derisorily low. On the others we will lose money.

• We believe that it is our first duty to shareholders to limit fees.

Both the investment management fee (equivalent to 0.32%) and ongoing charges (0.51%) are low by comparative standards but at least adequate in absolute terms. We think that the malign impact of high fees is frequently underestimated. The difference between ongoing charges of 0.5% and one of 1.5% may not appear great but if the perspective is altered to think of costs as a percentage of expected annual returns then the contrast becomes obvious.

If annual retums average 10% (sadly they have not in recent years) then this is the difference between removing 5% or 15% of your returns each year. Nor do we believe in a performance fee. Usually it undermines investment performance. It increases pressure and narrows perspective.