Citywire Selection: an introduction to our favourite investment trusts

Not a bad selection

Quite a few good long term performers here - but as usual not everyone can be right all of the time. For example Murray has a 9% premium and is weighted towards Asia and is currently trading at its all time high. You have to think Bruce S walks on water to beleive this can maintain the upside momentum in the coming months (October jitters?). Maybe he can - but I think the odds must be against it and I would rather buy (say) Aberdeen Emerging Markets (units) with no premium to gamble on any further upside. For the record I did hold MYI until very recently and sold at £9 - having bought it this time last year. Thank you to the investor(s) who bought it from me. As a wise man once said a profit is not a profit until it is taken. I will hopefully go back into MYI when (if?) the price and / or the discount fall back to a reasonable level.

Purely my view of course and it takes all views to make a market.

There is no real value in buying an investment trust at a premium or very small discount unless it is impossible to replicate the portfolio, as is the case with RIT Capital Partners. Non equity investment trusts that trade at a premium are best avoided. If Global equity markets continue to rally into 2011 with Western markets playing a bit of catch up with Asia Pacific and Emerging segments, I believe that the safety play will be large liquid trusts like Alliance Trust, while an open ended fund like M&G Global Basics is arguably a sensible global growth investment too for investors who would rather receive negligible taxable income.

but not the best ........

I've held RIT since 2005 and it has returned +%63 on original cap. It's an interesting Trust.

Check out Personal Assett Trust; full of inovative thinking and fine results over time. For me a core holding.

Where do CityWire get the TER for RIT Capital at 1.36%; Morningstar and FT both give it as 2.08%!!

Agree with Personal Assets which is a good long term hold and predicted the Credit Crunch at least one year before it happened. Interestingly, they sold out their Alliance Trust holdings because the management refused to fit their large discount to the true asset price, which would have made a lot of money for the shareholders. Personal Assets keep the discount at zero.

Personal Assets Trust, like its near namesake British Assets is a serial underperformer.

Its present standing is pure luck: the manager mistimed the recent market weakness by coming out of shares years too early, and has shown little stockpicking skill. Every dog has its day.