For investors that want a diversified exposure to lots of different companies or other assets, investment trusts can be an attractive option.
The most popular trusts on AJ Bell’s YouInvest platform in November include long-time favourites such as Scottish Mortgage (SMT), Finsbury Growth & Income (FGT) and Tritax Big Box (BBOX).
CHASING HIGHER DIVIDENDS
Murray International (MYI) aims to achieve a total return higher than its benchmark by investing in equities globally.
Fund manager Bruce Stout focuses on firms which can boost sales in order to maintain an ‘above average dividend yield.’ This strategy appears to be paying off as the investment trust has delivered a total return of 15.3% over the last year.
While the top 10 holdings include some overseas companies, recognisable names include cigarette conglomerates British American Tobacco (BATS) and Phillip Morris International.
'FUND FOR BEGINNERS'
Foreign & Colonial Investment Trust (FRCL) hopes to grow capital and income over the long-term. The trust believes it is ideal for people looking for their first investment or for regular dividends.
Over the last year, the trust has achieved a 23.6% total return and holds a wide range of well-known global businesses and brands such as Facebook, Amazon, Apple, as well as UK-listed oil giant BP (BP.).
The trust focuses mostly on overseas stocks due to a ‘meaningful outperformance of global versus UK equities’ over the last five years.
While this is a popular investment trust, investors should be cautious of the bias in the top 10 holdings towards tech stocks and make sure it is diversified according to their personal preferences.
If a trust is too focused on one sector, it could hit returns if the industry in question suffers a downturn.
INVESTORS KEEN ON WOODFORD DESPITE NEGATIVE SENTIMENT
Despite negative sentiment around Woodford Patient Capital (WPCT) due to underperformance in some of holdings, the trust is still popular.
Woodford Patient Capital provides exposure to disruptive early-stage and early-growth firm in an attempt to identify the best growth opportunities.
Its top 10 holdings include global biotech firm Prothena, online estate agent Purplebricks (PURP) and biopharma company Mereo Bioscience (MPH).
Prothena had a tough time earlier this month after US hedge fund Kerrisdale reported it was certain that its key drug would fail, triggering a sell-off.
Over the last year, Woodford Patient Capital has suffered a 10% drop in total returns.
