Hey All,
Quick question - Has anyone thought about building a portfolio of income producing investment trusts? Particular those that give you access to an unquote investment class i.e. infra structure?
Thanks!
Hi
About 25% of my entire portfolio is made up of investment trusts. At the moment, while I’m still accumulating, they’re 50/50 growth and income but ultimately, the intention is for them to provide me with income to cover my basic expenses.
I do hold one in infrastructure, HICL Infrastructure, which has a decent yield of >5% (as usual, DYOR etc). Did you have any other infrastructure ITs in mind?
Great to find another like-minded individual!
<5% of my portfolio is in an investment trust (TRIG - UK renewables), I’m more interested in income at this point and particularly gaining exposure to private market assets where the trust is trading at a discount to net asset value.
A few infrastructures I’m currently researching are:
- 3i Infrastructure
- Utilico Emerging Markets Trust plc
What are your thoughts on property REITs? Some seem pretty undervalued given the quality of properties in their underlying portfolio.
FYI a good site for ITs is: https://www.theaic.co.uk/
Hi,
I do build my portfolio from investment trusts now. Most of them are income orientated, but I like some growth as well, e.g. SMT and ATT.
I have some HICL as well as INPP. I like the steady cash flow of the infrastructure industry even if the growth is limited.
I have found some great websites for research:
Kepler Trust Intelligence - Detailed analysis of the trusts
interactive investor – the UK’s number one flat-fee investment platform - Past performance and categorisation
https://www.itinvestor.co.uk/ - A blog of an IT investor
And of course Morningstar for some extra details.
It is a great way to bulid a portfolio but always have to do loads of research because most of them underperform the market most of the time and there is no guarantee the ones are outperforming will continue to do so in the future. However I like the active management, the possibility of (reasonable) gearing and the option to keep a reserve which can be used to pay dividends in troubled times.
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Yes, I get most of my info on investment trusts from AIC. Do you use their income finder facility?
https://www.theaic.co.uk/income-finder
I use it (by building a virtual portfolio) to add different ITs to see what income I can get and to see how much I need to buy/build to get a desired income.
I’ve also plugged in my current investments to see what tweaks I need to make.
I currently hold BCPT which has been battered on the share price, plus they’ve cut their (monthly) dividend but I’m continuing to hold. Not sure about topping up…
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That AIC website is quite useful, thanks for recommending!
About 15% of my portfolio is in investment trusts. I allocate my “active manager” portfolio to investment trusts instead of mutual funds now. Two holdings I have are Scottish Mortgage and Polar Capital Technology.
I have some hard rules about them, such as liquid assets % in the trust, active share, track record and lastly fees. I can never avoid a fall like Woodford but these rules are generally in place to minimise that risk.
I personally use Genuine Impact (I’m not affiliated with them so study with your own discretion; I just find them quite useful in my research process) where I found my Polar Capital Technology as my 2nd investment trust holding. They are one of the largest tech-focused investment trusts in UK and the managers have managed the trusts for many years with some very clear investment process and market views, and some good performances, but they are no indication of future returns obviously.
The more I use Genuine Impact the more little gems I managed to find out over time. They got this easy filter where it gives you a list of investment trusts and you can sort them by their return, or risk or fees. I personally focus on technology and growth type of investment trusts since they are the active share of my portfolios and also it’s the sector I know about the most, and they also have some useful themes such as growth or innovation inside their filters.
One on my watchlist is BlackRock Frontiers and another one is Renewables Infrastructure Group. Haven’t decided to do anything with them yet.
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Thanks for sharing this info - looks like a good resource to research.
I’m also looking at Investment Trust options. So far, I only have a small investment in Schroder’s Oriental Investment (SOI); initially selected to diversify my portfolio and get some exposure into markets that weren’t covered by ETFs on Freetrade at the time. Scottish Mortgage is one I’ve been considering.
Thanks really helpful suggestions and will definitely check out the links
I actually haven’t before but will check this out - Thanks for the tip!
Hi All,
As the AIC website was already mentioned, if you are after income in particular you can use their income finder Sign in or register to start | The AIC which can be useful if you are after a monthly income with small variations.
For my investments I use either investment trusts or ETFs, I am not keen on open funds. Also with freetrade being free to trade I am focussing on total returns and not income. You can always sell a bit of a strong winner and derive income from there.
My strategy is fairly simple and straightforward, 20% bonds, 50% shares, 30% other where other is property 8%, private equity 7% and infrastructure 15%. I further split my shares part into core and satellite. I have 4 core holdings and 3 satellites. I don’t add new ideas as such but switch my satellites. By doing this I am forcing myself not to over-diversify.
I really like reading the news on Investment Trust Insider – Citywire , their weekly z-score is very useful for me.
One other thing I tend to do. If two trusts in the same area have performed similarly over 5 and 10 years and are otherwise quite similar in style and approach I always buy the trust with the smaller fees.
Hopefully some of this was useful!
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About 30% of my portfolio is in investment trusts, around 65% in ETFs, the rest in individual shares. I guess the ITs and ETFs are my core, and the shares my satellite.
I’ve probably got too many different ITs in my portfolio (20+, not all with Freetrade) but I’ve accumulated and held them over the years and at some point, I will simplify to a smaller number.
I’ve signed up to that citywire newsletter too and I find it useful.
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Didn’t realise this thread existed. I’ve had my 15% emerging markets allocation with JPMorgan JMG.L since I started investing. Good strategy and long term track record. I’ve recently built a 5% position in some growth trusts as I want some exposure to some private equities with promising futures.
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100% of my investment is in IT’s
Scottish Mortgage
Manchester & London
Edinburgh Worldwide
Baillie Gifford European European Growth
Baillie Gifford China Growth
Allianz Technology
Impact Environmental
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