Top ISA picks for 2019 – QuotedData’s James Carthew is one of a number of analysts suggesting investment companies that could be worth considering for this year’s ISA. This article was written by Investors Chronicle’s Leonora Walters.
10 investment trusts for your Isa 2019
Investment trusts are a good option for many different types of long-term Isa investor. You can invest as little as the cost of one share in a trust, so investors starting an Isa without much money to invest could buy a few shares in a broad global equity or multi-asset trust. Investment trusts also offer access to esoteric illiquid assets that private investors can’t access directly, such as property, private equity and infrastructure. These types of investment trusts can help to diversify large equity focused portfolios.
Below are 10 suggestions from investment trust analysts for growth, income, wealth preservation, diversification and a contrarian bet.
GROWTH – BlackRock Throgmorton Trust (THRG)
James Carthew, head of research at QuotedData, says: “BlackRock Throgmorton Trust is one of the best performing UK smaller companies funds. Its manager, Dan Whitestone, favours cash-generative, growing businesses with differentiated and defensive business models, and strong balance sheets. These growth companies fell out of favour with investors in January, and this and general negative sentiment towards the UK due to uncertainty over Brexit means that BlackRock Throgmorton’s net asset value (NAV) has fallen over the past year.
“Growth stocks have recovered a little so far this year, but are still well off the levels they reached last summer. Against this backdrop, BlackRock Throgmorton may be a good investment to tuck away for the long term. The trust is trading on a discount to NAV of about 2.6 per cent.
“Mr Whitestone has the flexibility to go short on companies that he thinks face structural challenges (going short involves taking a bet on a security’s price falling). This is an investment strategy that can add value in falling markets. For example, during 2018, when UK stock markets fell in value, going short added 1.4 per cent to the trust’s returns. But the trust’s board has placed strict limits on the use of this strategy.
“Mr Whitestone thinks that markets are correcting rather than entering a bear phase. He has identified many companies with strong order books and the ability to grow despite mediocre economic growth. He also favours companies with a high proportion of overseas earnings, which benefit from sterling weakness. This allows them to be more competitive and, in some cases, increase their profit margins.”
Mid Wynd International Investment Trust (MWY)
Simon Elliott, head of research at Winterflood Securities, says:…
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