Step-by-Step guide to investing: seminar 8

TIME TO MAKE A CHOICE!

We are putting together a few investment trusts (10 perhaps) as part of a balanced portfolio of trusts, funds, and bank deposits.

We are not going in for anything risky or wild, although investment trusts will undoubtedly form the more volatile part of the portfolio. We are looking only at well-established, well-run trusts. Trusts that know what its like to have felt the force of the economic gale, the destruction of asset values. Trust that have seen it all before, and have survived and prospered. Trusts that have whiskers.

We will look in three sectors:

Safety-first bread-and-butter UK growth and income trusts.

Romantic, slightly secretive, cool if not disdainful trusts.

The old leviathans: the global trusts!

Trust No 1

In the mid-nineties Moneybox Man asked Paul Kavanagh, now chairman of Killick Capital but then a modest stockbroker, to suggest a safe investment for his old dad's PEP, and Paul said: "Why not Temple Bar. It's a solid, reliable trust."

And indeed it suited Moneybox Man's old dad very well. Temple Bar started life in 1926 as the Telephone and General Trust. It is named after the place where the heads of traitors were dangled in the good old days. But it is no slouch, no dreamer of past glories. In the last five years it has consistently scored first or second place in the UK growth and income sector.

It invests mainly in the FTSE 100. It has some 30,000 shareholders. It has a young and successful manager. Its yield is around 4.5% and it is standing at a modest discount of 3.3%.