Interactive Investor

Top 10 most popular investment trusts: July 2020

4th August 2020 09:17

Tom Bailey from interactive investor

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There are two key areas that investors have been adding exposure to. 

Investment trust investors had a clear bias towards both technology and healthcare stocks in July, according to the latest most bought data among interactive investor customers.

The latest stats show that the most bought investment trust was once again Scottish Mortgage (LSE:SMT). While the trust is not strictly a tech-focused trust, as it invests in global equities, its portfolio is full of big technology names such as Amazon, Tesla, Alibaba and Tencent. Over the past three years, the trust has returned investors just over 118%.

Rising by one place was tech-focused Allianz Technology Trust (LSE:ATT). The trust sits in the Association of Investment Companies (AIC) technology specialist sector and despite a global mandate primarily invests in US companies. The trust has the strongest three-year performance of all the top 10 most bought trusts, returning investors 128%.

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Meanwhile, Polar Capital Technology (LSE:PCT), another technology specialist trust, has also continued to prove popular. Over the past year, the trust has returned investors just over 30%.  

Edinburgh Worldwide (LSE:EWI) also kept its place. The trust, as the name suggests, has a global investment mandate. However, as with Scottish Mortgage, it has a bias towards both US and tech stocks, with North America accounting for 60% of its portfolio. Among its largest holdings are Ocado, Tesla and Teladoc.

The popularity for tech is also evident following the entrance of Baillie Gifford US Growth (LSE:USA) trust to the rankings for the first time. The trust was launched just over two years ago. However, during that time it has provided investors with strong returns. Over the past year alone it has returned over 40%.

The trust’s mandate is to invest in US growth stocks. In practice, that means a portfolio full of technology stocks. The trust’s largest holdings include Amazon, Tesla, Shopify and Netflix.

Driving this preference for tech or tech-related trusts is likely their continued strong performance. While markets around the world have broadly recovered, technology stocks have surged even further ahead. As well as benefiting from continued low interest rates, many tech stocks are also seen as a defensive play in the pandemic, with their business models well suited to a world of lockdowns.

However, another Covid-19-related play among investors seems to be biotech and healthcare. Worldwide Healthcare (LSE:WWH) kept a place in the top 10 in July, albeit falling by one place. The trust has returned investors 20% over the past year.

The enthusiasm for biotech and healthcare, however, has also seen The Biotech Growth trust (LSE:BIOG) entered the rankings for the first time. The trust has provided returns of over 50%.

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There was also some enthusiasm for precious metals among investors, with Blackrock World Mining Trust (LSE:BRWM) rising by four places in the rankings. Managed by Evy Hambro and Olivia Markham, the trust has around 30% exposure to gold mining stocks. The price of gold hit an all-time high in July.

City of London (LSE:CTY) has continued to struggle, losing investors 22.1% over the past year. The trust is often seen as defensive. However, with a large number of dividend-paying stocks struggling this year, the trust has continued to lag. However, in July, the trust did confirm a 54th year of consecutive dividend increases.

Investment trust AIC sector Rank change from June 1-year return % (as at 3 August 2020) 3-year return % (as at 3 August 2020)
Scottish Mortgage Global no change 55.2 118.3
Allianz Technology Technology & Media 1 29.3 128
Polar Capital Technology Trust Technology & Media -1 30.7 89.3
Edinburgh Worldwide Global Smaller Companies no change 29.6 108.7
Blackrock World Mining Trust Sector Specialist: Commodities & Natural Resources 4 12.9 30.3
City of London UK Equity Income -1 -22.1 -15.2
Worldwide Healthcare Sector Specialist: Biotechnology & Healthcare -1 20.1 38.6
Baillie Gifford US Growth North America new entry 42.3 n/a
The Biotech Growth Trust Sector Specialist: Biotechnology & Healthcare new entry 51.5 52.5
Pacific Horizon Investment Trust IT Asia Pacific new entry 67.7 83.3

These articles are provided for information purposes only. Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties. The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.

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