The top 10 most popular investment trusts – October 2018

Private investors appeared unfazed by market turmoil in October, continuing to plough money into technology-focused investment trusts.

October was tough month for markets. Stocks around the world saw heavy selling and among the hardest hit was the once seemingly unstoppable US tech sector.

Private investors appear unfazed, continuing to plough money into technology focused investment trusts in October, according to the latest investment trust data from Money Observer’s sister website interactive investor.

Scottish Mortgage, which invests in global stocks with a heavy tech bias, continued its streak as the most popular investment trust among investor investor’s clientele.

The poor performance of many of its top holdings pushed down the trust’s one month return to -12.4%. Scottish Mortgage’s small premium narrowed, following the uptick in stock market volatility.

It was a similar story for other large global and tech focused trusts. Allianz Technology, run by the veteran tech investor Walter Price, also remained popular with investors, despite its one month share price return being -14.8%. Similarly, Edinburgh Worldwide had a one month return of -17.8%.

Another tech heavy trust in the top 10 is Finsbury Growth & Income trust, managed by star fund manager Nick Train. Around a third of assets are invested in either out-and-out tech companies such as Sage Group, or companies that are radically improving productivity via technology. The rest of the portfolio consist of consumer goods and services firms that are dominant players in their respective markets.

Meanwhile, Monks, which has a fifth of its holdings in tech, entered the rankings. Manager Charles Plowden and his two deputies, Malcolm MacColl and Spencer Adair, took over Monks in 2015 and have led a turnaround in performance.  

Smithson was another new name in the top 10. The brain child of Terry Smith, the manager of Fundsmith Equity, the trust invests in global smaller companies.

Following strong demand from private investors, Smithson comfortably exceeded its fundraising targets. It initially aimed for £250 million, before raising its target to £600 million. Both figures were soundly beaten, with Smithson raising £822.5 million. This surpasses the previous recordholder – Woodford Patient Capital – which raised £800 million in 2015. 

Elsewhere, Fidelity China Special Situations returns to the top 10.  While US tech has had a torrid month, Chinese equities have had a torrid year. The trust’s share price return is -17.8% for the year. With Chinese equities still out of favour, contrarian investors are perhaps eyeing up a buying opportunity.

City of London and Foreign & Colonial, regulars in our top 10, retained their places.

Name AIC Sector 1-year share price return (as of 1 November 2018) 3-year share price return
Scottish Mortgage Global 9.30% 93.60%
City of London UK Equity Income -2.70% 17.30%
Allianz Technology Sector Specialist: Tech Media & Telecomm 16.70% 128.70%
Baillie Gifford Shin Nippon Japanese Smaller Companies 6.80% 119.70%
Edinburgh Worldwide Global 19% 87.70%
Smithson Global Smaller Companies    
Monks Global 3.30% 92.80%
Foreign & Colonial Global 9.80% 63.50%
Fidelity China Special Situations Country Specialists: Asia Pacific -17.80% 46%
Finsbury Growth & Income UK Equity Income 2.90% 40.30%

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