Our Investment Analyst, Graham Spooner, explains why we’ve chosen to add these two top investment trusts to our preferred list.
An update to our preferred list of Investment Trusts
With a market cap of around £1.8bn Polar Capital is the largest and most liquid of its peer group. There has been a good long-term track record and 2018's performance was helped by holding a net cash position in a market that experienced increased volatility and significant declines over the final quarter. This enabled the fund manager, Ben Rogoff to add to preferred names. He focuses on bottom-up stock picking, along with the identification of core growth themes and he expects increased levels of volatility to continue.
Holding a technology fund could be regarded as a bit of a no-brainer in the world we now live in, where as recommending a fund that concentrates on UK medium and smaller companies in the present climate of political uncertainty and Brexit might raise some questions.
One of these questions could relate to timing. However, the main aim of preferred lists is to give our clients options to consider and not, as many fund managers will emphasise, try and predict market highs and lows. We like to reiterate that the investor who got in at the bottom and out at the top are either being economical with the truth or lucky.
A market friendly conclusion to Brexit, despite at the moment looking somewhat remote could give a boost to UK equities. Investors’ primary goal when investing in investment trusts should be for the long-term and they may take the view that the UK is not going to become some economic back water and that for an experience fund manager opportunities will continue. Mercantile has a good track record, is trading on a 9.6% discount, along with a 3.1% yield.
Over the coming months, the aim will be to further broaden the range of trusts included within our preferred list so keep checking for updates.
Our preferred list consists of a range of quality investment trusts, handpicked by our analysts to give exposure to a wide range of markets and sectors. If you’re looking for suggestions, check out the full list of our preferred investment trusts.
All information given including prices, yields and our opinion is correct at the time of publication. Our opinions on investments can change at any time and for our latest view please go to www.share.com. To understand how our Investment research team arrive at their views please read our Investment Research Policy.