Three investment trust analysts name their top tips for 2017/18

Three experts whose research we find particularly helpful have each picked a trust they expect to do well over the next 12 months.

Simon Elliott, head of investment companies research at Winterflood Securities and Charles Cade, head of investment companies research at Numis Securities, both did well over the past 12 months with the ordinary shares of Pantheon International and Worldwide Healthcare respectively.

Alan Brierley, who leads the investment companies team at Canaccord Genuity, was cautious and chose the sterling-denominated shares of BH Global, but he is sticking with it.

This year Cade recommends a leading private equity trust. ‘HgCapital Trust* (HGT) invests in unlisted growth businesses in northern Europe, including the UK, focused on technology and technology-enabled services companies.

‘These are profitable businesses that are market leaders in their industry niche, with diversified customer bases and highly predictable earnings regardless of the economic climate,’ Cade says. ‘Over the past decade, HgCapital has delivered NAV growth of 11.1 per cent per annum versus 5.5 per cent for the FTSE All-Share index.’

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Canaccord Genuity’s Brierley is sticking with his defensive recommendation of the sterling-denominated shares of BH Global* (BHGG). The single manager hedge fund invests all its assets in the Brevan Howard Multi-Strategy Master Fund. This gives it exposure to a wide variety of trading books, which Brierley expects will stand it in good stead should bond and equity markets get knocked back.

‘An almost inverse correlation between the company’s fortunes and risk assets has left BH Global in the wilderness in recent years. Consequently, sentiment is poor. But one day these characteristics will again have significant value,’ he avers.

‘My investment trust pick for the next 12 months is Monks Investment Trust (MNKS),’ says Elliott at Winterflood. ‘This trust is managed by Charles Plowden, senior partner at Baillie Gifford, and represents the firm’s best global equity ideas. Since he assumed responsibility in 2015 performance has been strong, benefiting from his growth investment approach.’

* These trusts are corporate broking clients of the firms

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