Biotech Growth (BIOG) and RTW Biotech Opportunities (RTW) have both benefited from Biogen’s announcement of a $5.6bn cash acquisition of Apellis Pharmaceuticals at $41 per share yesterday, which represented a 140% premium to Monday’s closing price. They held 1.7% and 1.1% respectively in the rare kidney and retinal diseases specialist.
RTW also saw Eli Lilly take out Centessa Pharmaceuticals, a smaller holding at 0.2% of net assets, in a $6.3bn cash bid that valued shares in the developer of treatments for excessive drowsiness and other neurological conditions at a 70% premium. Fund manager Rod Wong said: “These transactions are our seventh and eighth M&A outcomes since summer 2025, across both commercial-stage and clinical-stage companies, reinforcing the repeatability of our model and the value of our full life cycle approach.”
James Carthew, head of investment company research at QuotedData said: “Biotech M&A continues apace and the net asset value (NAV) gains that this is driving make recent discount widening look wrongheaded.”
Baillie Gifford China Growth (BGCG) has extended its recovery after returning 34% in the year to 31 January to beat its benchmark’s 11.8% gain and underpin a 38.8% advance for shareholders. After posting a 35.4% rise in net asset value in the previous year, today’s annual results show this cuts the shareholder loss to 11% since the former Witan Pacific appointed Baillie Gifford in September 2020 to run a China strategy.
QuotedData’s James Carthew said: “These were much better numbers from Baillie Gifford China Growth and it is encouraging to see that in NAV terms it has caught up with sector leader Fidelity China Special Situations (FCSS) over five years. It has helped that the Baillie Gifford trust has held up a little better than the Fidelity fund in the sell-off that was triggered by the Iran war. However, the managers’ comments reflect their belief that it is the underlying success of the companies in the portfolio not macroeconomics that will drive long-term returns for investors.”
Invesco Bond Income Plus (BIPS), the £443m high yield debt fund that raised £25m from investors last month, says it is conservatively positioned for the uncertainty stemming from the Middle East as the 7%-yielder reports a steady 8.7% total return for last year and plans to hold dividends at 12.25p this year. In its 2025 results chair Tim Scholefield said BIPS’ “closed ended structure makes it well positioned to take advantage of a sell-off when good quality bonds could be available at deeply discounted prices, locking in returns for the future.”
James Carthew of QuotedData said: “It is great to see BIPS delivering returns ahead of comparative indices and expanding. It is also pleasing to see how it has navigated the twists and turns of 2026, coming into the year positioned relatively defensively. The chairman points out that as a closed-end fund, it should be better able to take advantage of any sell-off in bond prices, when open-ended funds might be forced sellers. Let’s hope it doesn’t come to that, but it is a good argument for favouring trusts over other investment structures.”
JPMorgan American (JAM) says Eric Ghernati, co-manager of its growth stocks, is moving to a new job in JP Morgan Asset Management leaving Felise Agranoff in charge of that half of the investment trust’s portfolio. The £1.8bn trust, which also has value stocks run by Jack Caffrey and Graham Spence, underperformed last year with a 4.6% underlying investment return that was less than half the 9.6% sterling return from the S&P 500 index, while its shares, currently on a 3.6% discount to net asset value, returned just 0.5%. Nevertheless, chair Robert Talbot is optimistic given the “resilience” of US equities and the managers said: “Our research analysts anticipate strong earnings growth for the S&P 500.”
Value and Indexed Property Income (VIP), the £76m UK long-lease fund run by Matthew Oakeshott and Louise Cleary, made a 2.1% return in the first quarter with a capital gain of 0.5% as its Catterick hotel, Coventry bowling alley, Bebington convenience store and Brentwood health club rose in value, while the caravan park near Dover and the supermarket in Rayleigh slipped slightly. This takes the total 12-month return to 31 March to 6.5%. Both figures will be ahead of the MSCI UK Quarterly Property index. VIP will publish its 2026 annual report in June after the MSCI releases its first quarter review.
BH Macro (BHMG), the £1.3bn Brevan Howard hedge fund, made a disappointing 1.4% and 0.8% investment return for its sterling and dollar share class holders last year after the defensive, non-correlated fund notched up gains of 5.9% and 4.9% in 2024. Sterling shareholders lost 1.7%, according to the annual report, as the shares traded more than 8% below net asset value, leading to a continuation poll last month that 96% of shareholder votes supported.
Chair Richard Horlick said: “BH Macro has historically provided significant diversification from, and lack of correlation to, bond and equity markets. In today’s unpredictable global market environment, macro strategies such as BH Macro have never been more relevant. Whilst the board regards the company’s performance for 2025 as less than satisfactory (as does the manager), NAV returns were within expected bounds of return and proved the convexity of trades for which Brevan Howard are well known (ie, when ‘they get it wrong’ the downside risk of the NAV is limited, and on the other hand being able to capture plenty of upside when they are correct). As a board, we are confident that the actions we and the manager have taken are the best way to address the issues facing our shareholders, and as such, the board retains its confidence in the manager.”
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