Trusts investing in European and Japanese smaller companies were among some of the best performers during the first quarter of the year, according to data from FE Analytics.
The first quarter of 2017 saw the inauguration of Donald Trump as US president, the invoking of Article 50 by the UK government to exit the EU and several European political developments testing markets.
Yet, markets remained steady with the FTSE 100 reaching record highs and the US stocks still buoyant despite geopolitical headwinds gathering on the horizon for global investors.
With more sectors consisting of fewer funds, performance for the investment trust universe differed from the open-ended Investment Association results, where emerging markets shone brightly during Q1.
Data from FE Analytics shows that the European and Japanese smaller companies sectors were more consistent during the first three months of the year.
The IT European Smaller Companies sector was the best performer returning 15.73 per cent over the first quarter of the year, followed by the IT Japanese Smaller Companies sector, which was up by 14.09 per cent.
Source: FE Analytics
The best performer from the IT European Smaller Companies sector was the £533m four FE Crown-rated TR European Growth Trust, managed by Ollie Beckett. It was up by 20.46 per cent following a 19.62 per cent gain in 2016.
All three other trusts in the sector reported gains of more than 13 per cent during the first quarter, with FE Alpha Manager Sam Cosh notably recording a 14.92 per cent gain for the F&C European Assets trust.
In the IT Japanese Smaller Companies sector, Prospect Japan emerged as the strongest performer, recording a gain of 23.86 per cent.
Outside of the VCT and alternatives sector, several resources trusts emerged as the strongest performers.
Indeed, the RDP Global Resources trust was among the top performers for the quarter, returning 39.06 per cent. Also at the top of the first quarter’s performers was the Baker Steel Resources Trust, up by 32.17 per cent.
One of the top equities-focused performers was the Manchester & London trust, managed by Mark Sheppard, which returned 27.51 per cent over the first quarter. Another notable performer was the Chelverton Growth Trust, managed by David Horner and David Taylor, which rose by 25 per cent.
The best performing five FE Crown-rated investment trust during the first quarter was Nitin Bajaj’s Fidelity Asian Values trust, which returned 13.62 per cent over the three-month period.
Performance of trust vs sector & benchmark in Q1
Source: FE Analytics
It was closely followed by Baillie Gifford’s Shin Nippon investment trust – managed by Praveen Kumar – which recorded a 13.14 per cent gain.
Other strong performers included an 11.55 per cent return for the Schroder Asian Total Return fund, managed by King Fuei Lee and FE Alpha Manager Robin Parbrook.
Meanwhile, the £241.2m Invesco Perpetual UK Smaller Companies investment trust, overseen by Jonathan Brown and Richard Smith, returned 10.43 per cent.
The worst performing five FE Crown-rated trust was FE Alpha Manager Nick Train’s Lindsell Train investment trust, which after a formidable 61.86 per cent return in 2016, was down by 11.24 per cent during the first quarter.
The Riverstone Energy Fund recorded a 7.81 per cent loss during Q1 while the Blackrock North American Income trust fell by 5.22 per cent.
The best performing FE Alpha Manager of the first quarter was Sam Cosh with the F&C European Assets trust mentioned above.
Performance of trust vs sector & benchmark over Q1
Source: FE Analytics
Another European equities-focused FE Alpha Manager Alexander Darwell generated a 13.45 per cent gain with his three FE Crown-rated Jupiter European Opportunities.
SVM UK Emerging, co-managed by investment veteran Colin McLean and FE Alpha Manager Margaret Lawson, also returned 13.45 per cent during the first three months of the year.
Elsewhere, the BlackRock Latin American investment trust, overseen by FE Alpha Manager Will Landers, saw a 12.1 per cent gain over the period.
The worst performing investment overseen by an FE Alpha Manager was the BlackRock Commodities Income investment trust. The closed-end fund is co-managed by FE Alpha Manager Tom Holl and colleague Olivia Markham but slipped to a 12.12 per cent loss in the first quarter.