Investment Trusts from the Past for the Future

Five investment trusts are celebrating their 125th birthday this year. Morningstar analyst Jackie Beard explains why they have lasted so long and what the future holds

Jackie Beard, FCSI 25 February, 2014 | 12:01AM

This year, five investment trusts are celebrating their 125th birthday: British Empire (BTEM), F&C Global Smaller Companies (FCS), Merchants (MRCH), Edinburgh Investment Trust (EDIN) and Law Debenture (LWDB). A handful of their peers are even older – Foreign & Colonial Investment Trust (FRCL) was already 21 years old when these quas-quas-quicentennial celebrators were born.

So why is it that these investment trusts have enjoyed such longevity and age so much better than some of their peers? One answer lies in their ability to adapt to the current investing environment.

Foreign & Colonial Investment Trust, which launched in 1868, had a very different look when it started out, with investments comprised primarily of government bonds.  But as investment opportunities changed and stock markets evolved, so did the fund, and in 1925, the fund started to invest in equities.  In marked contrast to its holdings at launch, today that fund has less than 1% invested in bonds.

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The information contained within is for educational and informational purposes ONLY. It is not intended nor should it be considered an invitation or inducement to buy or sell a security or securities noted within nor should it be viewed as a communication intended to persuade or incite you to buy or sell security or securities noted within. Any commentary provided is the opinion of the author and should not be considered a personalised recommendation. The information contained within should not be a person's sole basis for making an investment decision. Please contact your financial professional before making an investment decision.

Securities Mentioned in Article

Security NamePriceChange (%)Morningstar
Rating
AVI Global Trust Ord684.09 GBP-1.14
BMO Global Smaller Companies Ord119.20 GBP0.34
Edinburgh Investment Ord440.14 GBP-1.75
F&C Investment Trust Ord661.04 GBP-0.75
Law Debenture Corporation Ord539.23 GBP2.13
Merchants Trust Ord332.05 GBP-1.18
North American Income Trust Ord227.07 GBP1.83
Scottish Widows UK All Share Track I Acc240.51 GBP-0.74

About Author

Jackie Beard, FCSI

Jackie Beard, FCSI  is Director of Manager Research Services, Morningstar EMEA

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