Top 10 most-popular investment trusts: October 2022

There were five new entries to our top 10 investment trust table, with dividend strategies in vogue.

Investors have been eyeing up income, with four of the five new entries to our top 10 most-purchased investment trust table in October returning cash to shareholders as part of their mandates.

Two have eye-catching yields, with Henderson Far East Income (LSE:HFEL) offering the highest by a fair distance, at 9.8%. The trust, which is trading on a small premium, adopts a value investing approach to investing in Asia-Pacific equities. It has returned to our top 10 in seventh place, having last featured in the table in July.

Next, Primary Health Properties (LSE:PHP), a real estate investment trust (REIT) that invests in purpose-built GP surgeries has a yield of 5.8%. That’s not the only attraction – the trust, which tends to trade on a premium – can today be picked up on an 8.1% discount to its net asset value (NAV). Over the past 12 months, the trust has traded on an average premium of 18.9%, according to analyst Numis.

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The trust’s share price has fallen 21.8% over the past six months. REITs have seen their share prices come off the boil for two reasons: higher interest rates increase the cost of their debt, and rising UK government bond (gilt) yields impact how investors value the expected income on offer from REITs.  

JPMorgan Global Growth & Income (LSE:JGGI), yielding 4%, is another new entry, in eighth place. The trust, whose merger with Scottish Investment Trust completed at the start of September, is ‘style agonistic’ through holding a mixture of growth and value shares.

Alliance Trust (LSE:ATST), which has a yield of 2.5% and is classed as a “dividend hero”, is another new entry in ninth place. It was last in the top 10 in May. The global multi-manager trust, popular among regular investors, has increased its dividend for 55 consecutive years. 

The final new entry is Ruffer Investment Company (LSE:RICA), one of a handful of wealth preservation trusts. It regularly appears in the top 10, but slipped out in September.

The trust, managed by Duncan MacInnes, has less than 20% in shares. Its defensive stance and ability to make money during challenging times has paid off in 2022 and it is up 6.6% year-to-date. It has outperformed its three main competitors, Capital Gearing, Personal Assets and RIT Capital Partners, which have since the start of the year lost 4.3%, 4.7%, and 17.4% respectively. 

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Scottish Mortgage (LSE:SMT), whose focus on growth businesses, some of which are disrupting the status quo in their respective industry, remains the most-bought investment trust among interactive investor customers. The growth style has been out of favour in 2022 due to high inflation and interest rate rises, which devalues the future earnings of such companies.

City of London (LSE:CTY) investment trust, a favourite among income investors, continues to occupy the second spot. It is managed by experienced hand Job Curtis, who has been at the helm since 1991. Curtis adopts a conservative approach in focusing on companies with good cash generation. He mainly sticks to the dependable, larger-company FTSE 100 dividend-payers. It has raised its dividend for 56 years in a row, and has a market-beating yield to boot of 5%.

The two alternative trusts in our top 10 table, Greencoat UK Wind (LSE:UKW) and Renewables Infrastructure Group (LSE:TRIG), remain in third and fourth place respectively. Both invest in “real assets”, which have historically proven their worth during times of high inflation. 

Completing the top five, having moved up one place is F&C Investment Trust (LSE:FCIT). The global multi-manager trust, overseen by Paul Niven, won promotion to the FTSE 100 in September. It is managed in a conservative manner, reflected in the portfolio being highly diversified, with around 400 holdings. This diversification, and the fact that it is a consistent income payer, having increased dividends for 51 consecutive years, makes the trust a potential core holding for investors. It is one of interactive investor’s Super 60 investment ideas.

Of those exiting the top 10, four were new entries last month: Tritax Big Box REIT (LSE:BBOX), Chrysalis Investments (LSE:CHRY), Merchants Trust (LSE:MRCH) and RIT Capital Partners (LSE:RCP). The other trust to depart has been a regular in the top 10 in 2022, BlackRock World Mining Trust (LSE:BRWM).

Top 10 most-popular trusts in October 2022

Source for share price performance figures Fe FundInfo, 1 November 2022. Note: the top 10 from interactive investor is based on the number of “buys” during the month of October.