10 hottest ISA shares, funds and trusts: week ended 31 May 2024

With the new tax year under way, we look at the investments ii customers have been buying within their ISAs during the previous week. The data includes only real-time trades, not regular investing instructions, and combines the use of both existing funds and new money.

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Top 10 shares in ISAs

National Grid (LSE:NG.) has spent a second week as the most-bought stock in ISAs on the interactive investor platform.

Interest swelled following the utility’s decision to launch the UK’s biggest rights issue since 2009 to raise funds for a massive investment programme over the next five years.

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There are some movements within the top 10, notably Rolls-Royce Holdings (LSE:RR.) rising four places to fourth in a week when a director added to their holding in the iconic engineer. That followed the previous week’s AGM trading update when boss Tufan Erginbilgic sounded more confident about 2024 guidance.

Diageo (LSE:DGE) is among four new entries. The drinks giant has recently been loitering just outside the most-bought list, but has made it into the top 10 for the first time at number three.

Shares have been a terrible performer for a couple of years. This time in 2022 they were trading above £40 compared with under £26 briefly last week when they fell to their lowest since November 2020. There’s no fresh news, but annual results are due at the end of July.

Ocado Group (LSE:OCDO) is in at six from 15th last time. Like Diageo, it’s been a terrible performer, down from £28 in early 2021 to as low as 332p in the past year and 385p currently. And, like Diageo, there’s nothing new to digest ahead of half-year results scheduled for 16 July.

M&G Ordinary Shares (LSE:MNG) has done little wrong, the shares steady and yielding around 10%. It’s always there or thereabouts in the most-bought list, so no surprise that it’s back in at seven after dropping out briefly the week before.

Most interesting newbie this week is International Consolidated Airlines Group SA (LSE:IAG) whose only previous appearance in the top 10 was at the beginning of March. Earlier last month it reported first-quarter results that beat analyst expectations, which were then followed last week by an ii view on the airline from interactive investor analyst Keith Bowman.

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IAG shares have done well this year as the industry continues its recovery from the pandemic. And now we’re told by the International Air Transport Association (IATA) that industry profits in 2024 will exceed previous forecasts made in December and June last year.

It expects a record five billion air travellers to generate net profit of $30.5 billion in 2024, up from $27.4 billion the year before and better than December’s forecast for $25.7 billion.

“The airline industry is on the path to sustainable profits, but there is a big gap still to cover,” warned said Willie Walsh, IATA’s director general and former CEO at IAG. “A 5.7% return on invested capital is well below the cost of capital, which is over 9%. And earning just $6.14 per passenger is an indication of just how thin our profits are - barely enough for a coffee in many parts of the world. To improve profitability, resolving supply chain issues is of critical importance so we can deploy fleets efficiently to meet demand.”

Phoenix, Aviva and BP drop out of the top 10 this time.

Top 10 funds and trusts in ISAs

Technology shares were in demand last week, with the £2.8 billion L&G Global Technology Index Trust rising two places to become the most-bought ISA fund or investment trust. It’s the first time the fund has been in top spot since the beginning of February.

This is one of the most popular ways for investors to own the tech theme. The passive fund is a top-quartile performer in its sector over one, three and five years due to large positions in standout stocks such as Microsoft Corp (NASDAQ:MSFT), NVIDIA Corp (NASDAQ:NVDA) and Apple Inc (NASDAQ:AAPL). Investors should be aware that it is very concentrated, however, with 68.10% invested in just 10 companies.  

It knocked another technology-focused fund, Scottish Mortgage Ord (LSE:SMT), off the top spot. SMT has recovered this year, rising 12%, and the discount to net asset value has narrowed to 8%.

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Also falling one place was Vanguard LifeStrategy 80% Equity, down to third. Jupiter India and Fundsmith Equity dropped in popularity as well, but the active funds still kept their places in the top 10.  

The biggest riser was JPMorgan Global Growth & Income Ord (LSE:JGGI), up three places to fifth. The active investment trust is a global “best ideas” fund that taps into the equity research resources at JPMorgan Asset Management.  

Royal London Short Term Money Market and Greencoat UK Wind (LSE:UKW) held on to the fourth and seventh positions. They offer attractive yields, at 5.19% and 7% respectively. 

HSBC FTSE All-World Index C Accrose one place to ninth, while UK equity income favourite City of London Ord (LSE:CTY) was the only new entry, in 10th, up from 20th the previous week.  

Funds and trusts section written by ii’s Sam Benstead.