Ten trusts that will give you a decent income, long term capital growth, and protect your savings in stormy weather! There was warm applause in the Bonny Prince Charlie Function Room as Alastair announced the winnersINCOME WITH GROWTH IN THE LONG-TERM
Temple Bar
Edinburgh
Finsbury Growth and Income
Henderson New Star Asian Dividend Income Unit Trust
Temple Bar has increased its dividend every year in the last 25 years, and has an excellent growth record under manager Alastair Mundy. Like the Edinburgh Trust it is cautiously managed, and in both cases you get a sizeable chunk of Britain's biggest and most well-run companies - Glaxo, BP, Vodaphone, etc.
Edinburgh is a billion pound long-established trust now in the hands of Neil Woodford, manager of the hugely successful Perpetual High Income Fund. The research resources behind Perpetual High Income are therefore available at no extra cost.
Finsbury is a much smaller UK trust with an individualist flavour. "The portfolio is full of companies whose products taste good – such as Diageo, Dr Pepper, Fullers, Marstons, Unilever and Youngs” says dashing manager Nick Train, who recently made a killing out of Cadburys.
Henderson Asian Dividend Income UT is the only unit trust to be selected. The seminar would have gone for Henderson Far East Income Trust, but this is so successful that it is currently at a premium of nearly 4%. Last autumn Henderson launched the Asian Dividend UT with the same manager, Mike Kerley, and the same remit. It has an initial charge of 5% but this can be reduced to 0.25% if bought on the Alliance Platform. It has an annual charge of 1.25%, but the agents' commission element will paid directly to you, again if bought via Alliance. (Fund symbol is EXPG)
GROWTH FROM THE WORLD'S ECONOMY
Murray International
Scottish Mortgage
Templeton Emerging Markets
Scottish Oriental Smaller
Hansa A
Murray International is run by sturdy Bruce Stout. He earlier told the seminar: "Following last years stock market rally of relief, this year stock markets must deal with reality. The withdrawal of unorthodox policies and tightening monetary policy at a time of such economic fragility is bound to cause uncertainty. A solid buy-and-hold approach ignoring short term fluctuations, will remain central to our investment strategy going forward" (Applause)
Scottish Mortgage is a big, big internationalist trust with £1890 million of capital spread round the world. It has over 50% invested in Europe and the US, and is a big supporter of companies like Amazon and Google. It has an excellent manager in James Anderson. It has very low expenses and a decent 2% dividend.
Templeton Emerging Markets is run out of Singapore by Dr Mark Mobus. It has a superb long term record. Co-manager Tom Wu works out of Hong Kong. The trust is big in China and Brazil.
Scottish Oriental is run by Sue Rippingale out of Hong Kong (see previous post) and is the only investment trust managed by the Australian First State Group. It specialises in smaller companies, where there is the maximum opportunity for growth. Expect it to be highly volatile - it has fallen from 434p a share to 389p in the last few weeks.
Hansa looks after the investments of the Solomon Family, and takes up large positions in companies where it thinks there is money to be made. It has a major holding in Oceans Wilsons, an emerging markets company that runs the ports of Brazil (and donates each year to a charity to rescue abandoned children in Rio). Hansa has had a bad couple of years, and is at an unusually wide discount.
PROPERTY
TR PROPERTY
Invests in property companies across Europe.
The ten trusts listed above give an average yield of 3.3%. A £100,000 portfolio therefore would return £3,300 a year in dividends.
Moneybox Man is hooked on yield. He would add two trusts out of the following.
Invesco Leveraged High Yield
Invesco Leveraged High Yield has a dividend of 8.6%. The value of the shares, however, has fallen by over 50% in the last decade. Yet look at the last 12 months - it's shares are up by 110% but its NAV by 160%. Volatile, but with terrific managers, take the dividends gratefully and don't pay attention to the share price (which anyway could easily double in the next decade).
Henderson High Income
Henderson High Income has 25% in bonds, and the rest in high-yielding equities, which inevitably means Vodaphone, BP, etc. It's well managed, and has an average risk rating and an excellent yield of 7.25%
Henderson Diversified Income
Covered in a recent post, this has an income of 7% from bonds.
Adding two of these high yield trusts will boost income significantly, and generally make life more interesting. A portfolio of £120,000 would yield 4.1% - that's £4,100 a year in dividends
Templeton Emerging Markets is run out of Singapore by Dr Mark Mobus. It has a superb long term record. Co-manager Tom Wu works out of Hong Kong. The trust is big in China and Brazil.
Scottish Oriental is run by Sue Rippingale out of Hong Kong (see previous post) and is the only investment trust managed by the Australian First State Group. It specialises in smaller companies, where there is the maximum opportunity for growth. Expect it to be highly volatile - it has fallen from 434p a share to 389p in the last few weeks.
Hansa looks after the investments of the Solomon Family, and takes up large positions in companies where it thinks there is money to be made. It has a major holding in Oceans Wilsons, an emerging markets company that runs the ports of Brazil (and donates each year to a charity to rescue abandoned children in Rio). Hansa has had a bad couple of years, and is at an unusually wide discount.
PROPERTY
TR PROPERTY
Invests in property companies across Europe.
The ten trusts listed above give an average yield of 3.3%. A £100,000 portfolio therefore would return £3,300 a year in dividends.
Moneybox Man is hooked on yield. He would add two trusts out of the following.
Invesco Leveraged High Yield
Invesco Leveraged High Yield has a dividend of 8.6%. The value of the shares, however, has fallen by over 50% in the last decade. Yet look at the last 12 months - it's shares are up by 110% but its NAV by 160%. Volatile, but with terrific managers, take the dividends gratefully and don't pay attention to the share price (which anyway could easily double in the next decade).
Henderson High Income
Henderson High Income has 25% in bonds, and the rest in high-yielding equities, which inevitably means Vodaphone, BP, etc. It's well managed, and has an average risk rating and an excellent yield of 7.25%
Henderson Diversified Income
Covered in a recent post, this has an income of 7% from bonds.
Adding two of these high yield trusts will boost income significantly, and generally make life more interesting. A portfolio of £120,000 would yield 4.1% - that's £4,100 a year in dividends
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