Top 10 investment trust winners in 2017

Kyle Caldwell
22 December 2017

Unless you have been sitting in cash, the chances are you have seen your portfolio rise in value over the past 12 months. Stock markets across the globe have been in fine form, in the case of both developed and emerging economies. 

Thanks to the rising tide there’s a greater chance than usual that investment trust fans may see one or two of their holdings appear in our table below, which showcases the investment trusts that topped the performance tables in 2017. 

That’s because usually, a certain specialist type of trust shines in a given year; in 2016 for example commodity-focused trust had their day in the sun.  

But as our top 10 table shows, a wide variety of strategies have enjoyed a hot streak of form over the past year. The figures, which were supplied by FE Trustnet, show the top 10 performing trusts in total return terms (ie including both dividends and share price growth). Trusts deemed to be geared primarily towards institutional investors, however, were excluded.  

Top of the table is Independent Investment Trust (IIT), up 71.3%. The trust has for years fallen under the radar of retail investors, but its eye-catching performance of late may spark an uptick in demand. However, bear in mind that the trust has subsequently become more expensive, evidenced by its premium rating of 7%. 

The trust has been managed by Max Ward since 2000. Ward is a ‘respected stock-picker’, according to Simon Moore of Seven Investment Management, but is ‘unlikely to be a name that younger investors are familiar with’.  

Prior to setting up IIT, Ward was a partner at Baillie Gifford and managed Scottish Mortgage. He targets high-growth companies; favouring technology and telecommunication firms. FeverTree, the trust’s top holding, has helped turbocharge performance. 

Taking the silver medal, perhaps surprisingly given all the negative sentiment towards UK equities, is River & Mercantile UK Micro Cap(RMMC), up 66.6%. 

In a recent update to investors, Philip Rodrigs, who manages the trust, noted that in the third quarter there were a number of ‘exuberant’ share price moves. He added: ‘These bullish share price actions suggest the market is increasingly willing to reward strong delivery by micro cap firms and, as a result, quickly take advantage of the discount valuations available in this area of the market.’ 

In third place is Manchester & London (MNL), up 64.5%. The trust has a number of fast-growing tech firms among its biggest holdings, a position that has paid off in 2017. A quarter of the trust is invested in Amazon, Alphabet and Microsoft. It also counts Scottish Mortgage as one of its top 10 holdings. 

Completing the top five are JP Morgan Chinese (JMC), which has posted gains of 55%, followed by TR European Growth (TRG), up 54.7%. 

The rest of the top 10 is a mixed bag, with a Japan trust featuring (Baillie Gifford Shin Nippon), as well as an India-focused trust (Ocean Dial Indian Capital Growth) and a commodity play in the form of Baker Steel Resources.

Overall, three funds from the Baillie Gifford stable feature: Baillie Gifford Shin Nippon (BGS), Pacific Horizon (PHI) and Edinburgh Worldwide(EWI).  

This article first appeared on our sister website Money Observer

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