The investment company, which focuses on UK large- and mid-caps, has now paid out dividends for 29 consecutive years.
In the year to the end of January, Merchants Trust outperformed its FTSE 100 benchmark index by 12.4 per cent and 3.6 per cent in terms of share price and net asset value (NAV) total return respectively.
“Global uncertainties continued to build throughout the year...Against this uncertain backdrop, the UK equity market has recovered further ground and made up much of the loss suffered since the start of the financial crisis in 2007,” the trust's new chairman Simon Fraser said.
He added: “Merchants performed well in both absolute and relative terms as well as compared to most of our peers, helped by strong stock-selection in a number of mid-cap companies.”
Source: Financial Express Analytics
Financial Express data shows Merchants Trust returning 28 per cent to investors in the year to the end of January, compared to 16.9 per cent from the IT UK Growth and Income sector. It took on more volatility to get those returns, however; 15 per cent over the year compared to 9.9 per cent from the sector average.
Manager Simon Gergel says he has recently switched from some outperforming shares into cheaper laggards, including those in the consumer staples sectors.
“Companies like Tesco, Reckitt Benckiser and Britvic have been sold off heavily on fears and warnings over increased commodity prices. We sold out of Home Retail Group on concerns about a deteriorating consumer outlook and pressure from the supermarkets and we sold the last Centrica shareholding at what we believed to be fair value,” he said.