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The democratisation of investment

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F&C Investment Trust was launched to make stock market investing accessible to “those of moderate means” – 150 years on, it continues to thrive.

Since its inception in London in 1868, the world’s first investment trust, F&C Investment Trust, has paved the way for the development of collective savings vehicles. The brainchild of city lawyer Philip Rose, who set it up alongside barrister Samuel Laing and Laing’s business partner James Thompson Mackenzie, the birth of F&C Investment Trust remains a milestone in the history of investment.

Before Rose’s groundbreaking idea, people who wanted to invest were faced with limited choice and considerable risk. Banks could – and did – fail with no chance of compensation, government bonds provided a paltry return, and foreign infrastructure projects promised much but were very risky.

And because only the richest could afford to diversify, the collapse of an investment could leave investors in financial ruin. The establishment of the Trust, therefore, represented not only a watershed moment for savers of “moderate means” but also a turning point for the way in which money was managed and invested. It allowed everyday investors to access the stock market through a single investment in a diverse portfolio, giving the everyday saver “the same advantage as the large capitalist”.

F&C Investment Trust began its life as an emerging market bond fund, with 18 investments across Europe, South America, the Middle East, New Zealand and North America. Unusually, it included a lottery element, perhaps to encourage potential investors to subscribe.

Today, the Trust[1] has total assets under management of over £4.1billion, diversified across more than 450 holdings and 35 countries, with around 95% of the portfolio invested overseas (as at May 31, 2019).

As a pioneer in 1868, the Trust has remained on the front line of the collective investment industry. It has played a vital role in the formation of a trade association for closed-ended funds[2] – the organisation known today as the Association of Investment Companies (AIC) – introduced regular savings schemes to the UK investment trust market[3] and, without fail, paid a dividend every year throughout its long life. 

Although it was intended to have a fixed life of only 24 years, F&C Investment Trust is still thriving 150 years on, having withstood world wars, financial crises, recessions, and 15 decades of social and cultural change.

Initially, Victorian savers could invest from £100; today, the Trust is predominantly held by retail investors. Now with more than 100,000 direct shareholders, F&C Investment Trust continues to realise Philip Rose’s ambition of an accessible, democratic investment product.

If you would like more information, visit the F&C Investment Trust website or speak to your financial adviser. 

Past performance should not be seen as an indication of future performance. The value of investments and any income from them can go down as well as up and investors may not get back the original amount invested.

© 2019 BMO Asset Management Limited is authorised and regulated by the Financial Conduct Authority.

[1] BMO. (June, 2019), F&C Investment Trust PLC Factsheet June 2019 [Online]. Available at www.bmogam.com/fandc-investment-trust/wp-content/uploads/2019/06/fc-investment-trust-plc-factsheet.pdf (Accessed 28 June 2019) 

[2] Newlands, J. (2018) A History of Foreign & Colonial Investment Trust. London, BMO Global Asset Management. 

[3] Newlands, J. (2018) A History of Foreign & Colonial Investment Trust. London, BMO Global Asset Management.

BMO ITs

At BMO, our aim is to help our clients overcome the challenges they face and deliver the investment outcomes they seek. We've been helping clients with their financial needs for over 200 years.

A lot has happened since 1817, including the launch of the world's oldest collective investment fund vehicle - F&C Investment Trust over 150 years ago. This fund made investing more accessible to individual investors and we are proud to still manage it today.

We currently manage 10 Investment Trusts, providing a range of investment opportunities including access to equities, bonds, property and private equity. Each trust has different aims and objectives with the option of capital growth, income or a combination of the two and with a specific regional focus or with a global remit.

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