The UK’s biggest and most popular investment trust is one of Tencent’s top backers.
About 5.8 per cent of Scottish Mortgage’s funds are invested in the Chinese company – the trust’s single biggest holding.
Its sixth-biggest holding is in Tencent’s rival, Alibaba, with 3.9 per cent of funds invested in the stock.
Holding: About 5.8% of Scottish Mortgage’s funds are invested in the Chinese tech giant Tencent
According to Scottish Mortgage, the stake in Tencent was valued at £1billion at the end of May.
The £16billion investment trust’s holding in Alibaba was worth another £723million.
Scottish Mortgage is co-managed by Baillie Gifford’s James Anderson and Tom Slater, with its returns far outpacing the MSCI World Index thanks to successful investment in tech stocks such as Tesla, Amazon, Facebook, Alibaba and Tencent.
But its heavy involvement in China became a subject of potential concern earlier this year amid a crackdown by Beijing on tech companies.
Alibaba founder Jack Ma disappeared from the public eye for months after falling out with financial regulators, while Tencent and other gaming companies were previously blocked from releasing new titles for nine months.
But Anderson – who is due to retire next year – has played down any concerns and warned shareholders it would be ‘dangerous’ to react quickly to news headlines.
‘Actually, what we think is happening is that China is moving principally to a policy of greater antitrust requirements in a way that I think would have been beneficial in America and Europe,’ he told investors.
‘Now, none of that is to excuse aspects of the Chinese political scene or the directions it’s gone.
‘But we do not think the overall operation conditions have deteriorated as drastically as the media would like you to believe.’
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