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BlackRock Throgmorton in the FTSE 250: buy, hold or fold?

The trust is the second-best performer in the IT UK Smaller Companies sector over 10 years, but can it keep it up? We asked a selection of analysts for their view.

21 September 2021 By Eve Maddock-Jones,, Reporter, Trustnet

BlackRock Throgmorton Trust is one of the latest entrants to the FTSE 250, following the most recent quarterly shake-up. Previously a member of the FTSE Small Cap, it was promoted to the mid-cap index with six other companies: Baltic Classifieds, Bridgepoint, DarkTrace, Draper Esprit, Endeavour Mining and Weir. It was the only investment trust to be added in this allocation.

This follows a positive year for the trust, in which it has made the fourth-highest returns in the sector so far in 2021, even though manager Dan Whitestone’s growth bias has faced headwinds during the value rally.

James Carthew, head of investment companies at QuotedData, said that a large part of this performance was down to Whitestone’s stock picking abilities.

He said that Whitestone “is genuinely excited about the prospects for the companies in the portfolio” and the UK market in general. In the latest half-yearly report, the Throgmorton manager said that the trust’s ability to outperform in a market which is “less favourable to differentiated growth” is an indicator of the opportunities in the UK.

Carthew added that as international investors become more positive on the UK again, the trust is set to benefit from a pickup in M&A activity.

The trust has also benefited from its ability to take long and short positions, with the latter focused on companies with disrupted business models. Simon Elliott, head of research at Winterflood Securities, said this helps to differentiate it from its peer group…

Carthew noted the trust has also outperformed over 10 years, making the second highest returns in its sector over this time, at 614.4%. He was overwhelmingly positive on the future prospects for the trust as well.

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