Top 10 most-popular investment trusts: January 2021
We run through the trusts investors bought in the first month of the year.
1st February 2021 14:40
by Kyle Caldwell from interactive investor
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We run through the investment trusts investors bought in the first month of the year.
It is early days, but one of last year’s big trends has continued to play out in the first month of 2021: Chinese shares are continuing to climb.
The positive start to the year, which in early January saw China’s CSI 300 index reach its highest point since 2008, has come on the back of a surge of new investor accounts being opened in the country, with retail investors being drawn to the market’s strong performance since the end of March 2020. In addition, eye-catching share price rises from Chinese technology companies, such as Tencent (SEHK:700) and Meituan (SEHK:3690), have piqued investor interest.
Customers of interactive investor have been seeking to take advantage of the positive momentum. JP Morgan China Growth & Income (LSE: JCGI) climbed up seven places to take third place in our top 10 league table in January, while Fidelity China Special Situations (LSE: FCSS) jumped two places to occupy the fourth position.
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Both trusts have performed strongly over the past year, with JCGI’s share price up 138% and FCSS posting a 93% gain.
It is not only Chinese-focused trusts that investors are backing to continue their rich veins of form. There are a number of other trusts in the top 10 that have produced stunning returns over the past year and continue to attract investors.
Scottish Mortgage (LSE: SMT) once again retains its position as the most-popular trust among interactive investor customers . Analysts at Kelper are divided on whether SMT’s strong share price run, which has been fuelled by its bias towards technology companies, will continue. SMT’s share price return over the past year stands at 117%.
Hot on SMT’s heels is another trust in the Baillie Gifford stable, Edinburgh Worldwide (LSE:EWI). Douglas Brodie, head of the global discovery team, has run the trust since 2014. He focuses on identifying early stage companies that are offering solutions that haven’t yet been addressed by larger companies. The trust is up 90% over the past year.
Completing the top five is Monks (LSE: MNKS). The global trust is regarded as a less aggressive version of Scottish Mortgage. Its fund manager, Charles Plowden, is retiring at the end of April. He will be replaced by current co-manager Spencer Adair. Returns over the past year of 42% have been more modest compared to the other Baillie Gifford-managed trusts in the top 10.
Two other trusts in the top 10 that have, along with SMT and JCGI, more than doubled investors' money over the past year are Pacific Horizon (LSE: PHI) and Baillie Gifford US Growth Trust (LSE: USA). Returns are neck and neck, with USA up 129% versus 128% for PHI.
Allianz Technology (LSE: ATT) has also enjoyed a spell of strong performance, up 63% over the past year. Walter Price, who has 40 years’ experience of investing in technology, has run the trust since 2007. He is part of Allianz Global Investors’ technology team based in San Francisco. It retains its place in seventh position.
BlackRock World Mining (LSE:BRWM) has also had a strong run, with its one-year performance showing a return of 60%. Investing in mining shares is not for the faint-hearted, however. The fund goes through hot and cold periods of performance.
In general, when considering investing in a trust which has a more adventurous risk profile and that has experienced a strong spell of performance, investors need to avoid falling into the potential trap of performance-chasing. We explain why in brief in the video below.
Finally, the only new entry to the top 10 in January was Smithson (LSE:SSON). It replaced UK-listed hedge fund Pershing Square Holdings (LSE: PSH). SSON applies the Fundsmith investment philosophy to global smaller companies.
Top 10 most-popular investment trusts: January 2021
| Trust | Sector | Rank change from December 2020 | One-year performance to 1 Feb 2021 (%) | Three-year performance to 1 Feb 2021 (%) | |
|---|---|---|---|---|---|
| 1 | Scottish Mortgage | Global | No change | 117 | 182.5 |
| 2 | Edinburgh Worldwide | Global smaller companies | No change | 90.4 | 143.6 |
| 3 | JP Morgan China Growth & Income | Asia Pacific ex Japan | Up 7 | 137.8 | 136.7 |
| 4 | Fidelity China Special Situations | Asia Pacific ex Japan | Up 2 | 92.7 | 74 |
| 5 | Monks | Global | Down 3 | 42.1 | 69.3 |
| 6 | Pacific Horizon | Asia Pacific ex Japan | Down 2 | 127.9 | 127.6 |
| 7 | Allianz Technology | Technology & Media | No change | 62.7 | 141.7 |
| 8 | Baillie Gifford US Growth | North America | Up 1 | 128.8 | *N/A |
| 9 | Smithson | Global smaller companies | New entry | 26 | *N/A |
| 10 | BlackRock World Mining | Commodities & natural resources | Down 2 | 59.8 | 57.1 |
Source: Interactive investor. FE Analytics used for performance figures. Note: the top 10 is based on the number of “buys” during the month of January 2021. *Insufficient track record.
These articles are provided for information purposes only. Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties. The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.
Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.