British investors piled money into long-term growth funds and investment trusts as the tax year drew to a close at the start of April, new analysis shows.
Fundsmith Equity and Lindsell Train Global Equity funds topped the bestsellers list at DIY investor platforms Hargreaves Lansdown, Interactive Investor and AJ Bell in the first quarter of 2019, having tempted investors with their stellar returns.
It was a similar story in the investment trust sector, with industry stalwarts Scottish Mortgage Investment Trust and City of London Investment Trust coming top of the class across the three platforms on aggregate.
Fundsmith, managed by Terry Smith, has returned a whopping 333 per cent in a little over eight years since it was launched (to 22 April 2019), turning a £1,000 investment into £4,330, according investment research tool FE Analytics.
Remember that good past performance does not always mean positive results in the future
Lindsell Train Global Equity, headed by Nick Train and launched four months later in April 2011, is up 279 per cent, turning £1,000 to £3,790 since inception.
To put this into perspective, the MSCI World index benchmark and the average actively managed global fundwhere a fund manager cherry picks stocks, returned 84 per cent and 66 per cent respectively over the same period.
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Few would contest that both are among the best funds that scour global stock markets for the best growth opportunities in market.
For a more in depth review of how the two funds approach investing, read our analysis here.
Other popular funds during the Isa season included Baillie Gifford American, which is top performer in the North America sector over three and five years, and Vanguard's one-stop-shop Lifestrategy fund range.
Funds | Investment Trusts |
---|---|
Fundsmith Equity | Scottish Investment Trust |
Lindsell Train Global Equity | Scottish Mortgage Investment Trust |
AJ Bell multi-asset | City of London Investment Trust |
Fidelity Global Special Situations | Finsbury Growth and Income |
Fidelity Index World | Witan |
Evenlode Income | Murray International |
Polar Capital Global Technology | Smithson |
Jupiter Special Situations | Edinburgh Investment Trust |
Vanguard Lifestrategy | Merchants |
Lindsell Train UK Equity | RIT Capital Partners |
Popular investment trusts
Scottish Mortgage Investment Trust is one of the best performers of all global investment trusts and has beaten broad global indices such as FTSE All World over five years (178 per cent versus 87 per cent).
Meanwhile, the City of London Investment Trust, which aims to provide long-term growth in income and capital, principally by investment in equities listed on the London Stock Exchange, has racked up an astonishing 52 years of dividend rises - a record held by only two other trusts.
Funds | Investment Trust |
---|---|
Artemis Income | Bankers Investment Trust plc |
Baillie Gifford American | City of London Investment Trust |
Fundsmith Equity | Edinburgh Investment Trust plc |
JPMorgan Emerging Markets | Fidelity China Special Situations PLC |
LF Lindsell Train UK Equity | Finsbury Growth & Income Trust plc |
Lindsell Train Global Equity | Lindsell Train Investment Trust plc (The) |
Newton Global Income | Merchants Trust plc |
Rathbone Global Opportunities | Murray International Trust plc |
Royal London Sterling Extra Yield Bond | Scottish Mortgage Investment Trust |
Threadneedle UK Equity Income | Smithson Investment Trust Plc |
Illustrating further Nick Train’s popularity, another portfolio under his helm, Finsbury Growth & Income Trust, is also among the Isa season bestsellers across the three platforms.
The newly launched Smithson, backed by Terry Smith,made the cut on Hargreaves Lansdown and AJ Bell platforms although Smith is not managing the trust on a day to day basis.
He is said to be offering 'support and advice' to the managers Simon Barnard and Will Morgan.
Funds | Investment Trust |
---|---|
Fundsmith Equity | Scottish Mortgage Investment Trust |
Lindsell Train Global Equity | City of London Investment Trust |
Vanguard Lifestrategy (80 percent equity) | Allianz Technology Trust |
Baillie Gifford American | Finsbury Growth & Income Trust |
Baillie Gifford Global Discovery | F&C Investment Trust |
Moira O’Neill, head of personal finance at Interactive Investor, says: 'The 2018/19 Isa top picks show a strong element of investors sticking with solid, tried and tested names and brands.
'Among funds and investment trusts, it is those with a clear, well communicated strategy, combined with strong long-term performance, that time and again attract the greatest share of the pie.'
She added: 'They make it look so easy, but with the same names appearing time and again, many would like to know the secret.’
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