Train’s Finsbury Growth & Income Trust was named earlier this week as one of only three UK equity income funds to achieve this double accolade.
Lindsell Train IT, the manager’s £49.6m portfolio, has doubled its investors’ money over the past five years, while the average trust in the Global Growth sector has made just 17.14 per cent, according to data from FE Analytics.
Performance of trust vs sector over 5-yrs
Source: FE Analytics
Sebastian Lyon’s £534m Personal Assets Trust has made 72.84 per cent since 3 March 2009, when the manager took charge.
Although this is below the returns of the FTSE All Share benchmark over that time – the index has made 98.7 per cent – Personal Assets Trust is a multi-asset fund with considerable fixed interest exposure.
Performance of trust vs index since March 2009
Source: FE Analytics
This is in part why its three-year annualised volatility is just 6.28 per cent, less than half that of the FTSE All Share.
The Personal Assets Trust has a rigorously applied discount-control mechanism, whereby the board issues new shares on a regular basis to keep the premium to NAV down.
As a result, despite the popularity of the trust, it is trading on a premium of just 1.8 per cent, according to the AIC.
Lindsell Train does not have such a mechanism and is currently trading on a considerable premium of 14.79 per cent. The trust holds 15 per cent in Nick Train’s private equity company Lindsell Train Limited, which is its largest single holding.
It is fully invested in equities, unlike the Personal Assets Trust which holds 14.4 per cent in gold bullion and 35 per cent in bonds.
The total expense ratio (TER) on Lindsell Train IT is 1.1 per cent and 1.15 per cent on Personal Assets Trust.
Investment trust managers cannot be awarded FE Alpha Manager status unless they also run an open-ended fund, which may explain why a number of formidable managers in the global sectors do not have that accolade.
The Baillie Gifford Mid Wynd International IT sits in the IT Global Growth sector and has five FE crowns.
The fund is a top-quartile performer over three, five and 10 years, having made 217.7 per cent over the past decade.
Performance of trust vs sector and benchmark over 10-yrs
Source: FE Analytics
Data from FE Analytics shows that most of manager Michael McPhee’s outperformance was generated in 2010.
The trust made 63.89 per cent in that 12-month period, while the FTSE World index made 16.28 per cent. In the following two years its performance has been less impressive, 2011 seeing losses of 14.51 per cent and 2012 a gain of just 2.31 per cent. Both are bottom-quartile figures.
The TER on the trust is 0.77 per cent.
Also in the Global Growth sector is Law Debenture Corporation, which is run by FE Alpha Manager James Henderson and has four FE Crowns.
The trust has made 215.03 per cent in the past 10 years, 52.55 per cent over five and 76.12 per cent over three, according to data from FE Analytics.
It is an investment company but also a corporate service provider, offering structured finance administration and whistle-blowing services among others.
Data from FE Analytics shows that Henderson has returned 246.22 per cent since our data begins in 2000, compared with 97.24 per cent from his peers.
The trust is available with a TER of just 0.49 per cent.