By Emmy Hawker, Senior reporter, Trustnet, 14 August 2025:
With UK inflation hovering at 3.6%, investors face the ongoing challenge of chasing returns that don’t only grow their wealth but outpace the rising cost of living.
Following the Bank of England’s decision to cut interest rates from 4.25% to 4%, money-market-funds and cash returns will be lower, so investing might appeal to more people.
As such, Trustnet asked experts which funds or investment trusts they would recommend for investors looking to beat inflation levels.
James Carthew, head of investment company research at QuotedData, picked Target Healthcare REIT.
It is a portfolio of 93 purpose-built care homes that specialise in dementia care. “There is a shortage of good dementia care places and growing demand,” Carthew said.
The £625m trust has inflation-linked rents that rise in line with the Retail Price index (RPI)..
Carthew also picked GCP Infrastructure Investments – in which he is a shareholder.
“Many infrastructure trusts have assets with revenues explicitly linked to inflation,” he explained.
Recently updated NAV-sensitivity data noted that a 1% uplift in inflation above current forecasts would add 4.5% (or 4.6p) to GCP Infrastructure’s NAV, and a 2% uplift would add 9.8p, according to Carthew.
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