There are two new entries in our top 10 table, which is based on the number of buys in April.
The start of the new tax year has led some ‘early bird’ ISA investors to increase exposure to investment trusts that invest globally, resulting in Smithson Investment Trust (LSE:SSON) and Alliance Trust (LSE:ATST) entering our top 10 table.
Our list, based on the number of buys in April among customers of interactive investor, is now comprised of five trusts that invest globally.
Scottish Mortgage remains the most popular trust, a position that it has consistently occupied since June 2019. Its retention of the top spot comes one month on from the news of James Anderson’s retirement next April. Tom Slater, who has been joint manager of the trust since 2015, will become lead manager from April 2022.
Lawrence Burns, who has co-managed the Baillie Gifford International Concentrated Growth Strategy since 2017, will become deputy fund manager with immediate effect. Burns has worked at Baillie Gifford since 2009.
- James Anderson to step down from Scottish Mortgage next April
- Ian Cowie: why I can’t quite bring myself to buy Scottish Mortgage
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The next global trust is Monks, which is regarded as a less aggressive version of Scottish Mortgage. It climbed five places up the table in April to fourth place. Its longstanding fund manager Charles Plowden retired at the end of April. He has been replaced by co-manager Spencer Adair, who has stepped up to become lead manager. Like other Baillie Gifford trusts, Monks adopts a long-term growth-oriented approach.
Alliance Trust, a new entry, completes the trio of trusts in the AIC Global sector in our top 10. Alliance Trust is a multi-manager ‘best ideas portfolio’, with each manager’s portfolio typically containing 20 stocks. In April 2017, Alliance Trust switched to the multi-manager structure, which is overseen by Willis Towers Watson. Since then, Alliance Trust has outperformed its benchmark – the MSCI All Country World Index – with its share price up 54.9% versus 52.4% for the index, according to figures from FE Analytics.
The remaining two of five global trusts invest in global smaller companies. Edinburgh Worldwide (LSE:EWI) occupies the third spot, down one place from March. Douglas Brodie, head of Bailie Gifford’s global discovery team, has run the trust since 2014. Brodie and his team focus on identifying early stage companies offering solutions that haven’t yet been addressed by larger companies. Such companies tend to be early stage disruptors in the industry they operate in.
The other global smaller companies trust is Smithson, which has returned to the top 10 having slipped out in February. The trust, managed by Simon Barnard, last month reported its results for 2020. It announced that it had returned investors over 30% in 2020. In comparison, the trust’s benchmark, the MSCI World SMID Index, returned just 12.2%.
Smithson applies the investment philosophy of Terry Smith's Fundsmith Equity fund, but instead focuses on global smaller companies that are deemed too small to be held in Fundsmith. Since its launch in November 2018, Smithson’s share price total return is 77.2% versus 38.6% for its benchmark.
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City of London rises to second place in our rankings
Elsewhere, City of London (LSE:CTY) investment trust continued to climb up the table. It is now in second place, having re-entered the top 10 last month. The trust, managed by Job Curtis, has raised dividends for 54 consecutive years.
Curtis invests in companies undervalued on a medium-term basis that he can invest in over the long term. In March, Curtis added to existing holdings in Legal & General (LSE:LGEN)and Phoenix (LSE:PHNX). Its holding in ITV (LSE:ITV) was sold.
Curtis explained: “Additions were made to City of London’s holdings in life insurers Legal & General and Phoenix, which reported satisfactory profits and dividends for 2020 and should benefit from the recent rise in bond yields. After the strong recovery in its share price, the holding in ITV was sold given competition for television from new services.”
Also moving up the table in April was BlackRock World Mining (LSE:BRWM). It jumped five places to fifth position, having entered the top 10 last December. The trust’s six-month and one-year performance figures are particularly strong, with gains of 54.3% and 114.4%. Commodities have soared during the pandemic, and investment bank Goldman Sachs believes the rally has only just started. The bank has predicted the start of a commodities supercycle – a multi-year bull market.
Fidelity China Special Situations (LSE: FCSS) also advanced, rising one place to seventh. The trust has doubled investors’ money over the past year, but performance has cooled over the past three months – with the share price down 3.2%. It has, however, has fared better than JP Morgan China Growth & Income (LSE: JCGI), which lost 12.5% over the same time period. JPMorgan China Growth & Income’s faltering short-term performance took place at the same time as the trust exited our top 10 table.
Top 10 most-popular investment trusts: April 2021
|Trust||Sector||Rank change from March 2021||One-year performance to 1 May 2021 (%)||Three-year performance to 1 May 2021 (%)|
|1||Scottish Mortgage||Global||No change||97.8||167.3|
|2||City of London||UK equity income||Up 5||22||5.4|
|3||Edinburgh Worldwide||Global smaller companies||Down 1||67.7||130.7|
|5||BlackRock World Mining||Commodities & natural resources||Up 5||114.4||97.1|
|6||Allianz Technolgy||Technology & Media||Down 2||63.7||130.4|
|7||Fidelity China Special Situations||China/Greater China||Up 1||100.1||88.1|
|8||Baillie Giffford US Growth||North America||Down 5||100.3||218.7|
|9||Smithson Investment Trust||Global smaller companies||New entry||36.7||*N/A|
|10||Alliance Trust||Global||New entry||40.3||42.9|
Source: Interactive investor. FE Analytics used for performance figures. Note: the top 10 is based on the number of “buys” during the month of April 2021. * Insufficient track record.
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Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.