From chips to couture: Baillie Gifford explains top long-term stock picks

Investment success relies on identifying "N of 1" companies with enduring, hard-to-replicate competitive advantages. NVIDIA and ASML exemplify this, maintaining dominance through superior execution and technological moats that competitors struggle to bridge. While TSMC serves as the indispensable foundation of the chip industry, its valuation reflects a persistent geopolitical discount tied to its location in Taiwan. Beyond semiconductors, long-term portfolio growth stems from consumer brands like Moncler and Netflix, which leverage powerful brand cachet and operational adaptability to maintain pricing power. Conversely, the memory and flash sectors remain unattractive due to their commoditized nature and the difficulty of sustaining long-term competitive advantages. This strategy prioritizes companies with decade-long horizons, favoring structural monopolies and unique market positions over short-term cyclical gains.