Looking for the best investment trusts to buy for long-term growth and dividend income? Here are three I think investors should consider giving a close look.
JPMorgan Global Growth & Income
The JPMorgan Global Growth & Income (LSE:JGGI) trust does exactly what it says on the label. It invests in a variety of global stocks — typically in a range of 50 to 90 — to drive capital appreciation and generate a decent dividend income.
Last year, the trust raised the annual dividend 23.6%, a rise helped by its large distributable cash reserves.
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As with many pooled investments, it has significant holdings in US tech stocks to attain growth. Microsoft, Amazon, Nvidia, and Meta are (in order) its four largest holdings. In total, just over a quarter of its capital is spread across semiconductor manufacturers, software developers, and hardware makers.
But unlike some trusts, this JP Morgan one uses borrowed funds to strive for superior gains. While the presence of gearing like this can amplify investor earnings, it can also exacerbate losses if the trust underperforms.
BlackRock World Mining Trust
The BlackRock World Mining Trust (LSE:BRWM) provides investors with a more targeted approach. In this case, it’s designed to generate a profit as commodities demand steadily grows.
That said, the trust’s exposure to the mining sector is spread far and wide. Approximately 60% is invested in mining companies with global operations, a quality that helps it absorb upheaval (like political instability and conflict) in certain regions. Multinational operators BHP, Rio Tinto, and Glencore are some of the largest of its 60-plus holdings.
In addition, this BlackRock product provides exposure to a range of industrial and precious metals including copper, iron ore, and gold. As a consequence, investors can enjoy a multitude of growth opportunities as well as a stable return across the economic cycle.
The trust could be a great way to capitalise on long-term themes like rising digitalisation, the growth of clean energy, and ongoing urbanisation. However, volatility on commodity markets could impact investor returns from year to year.
Alliance Witan
Alliance Witan (LSE:ALW) is one of the world’s oldest investment trusts. And for dividend hunters, it might be one of the best to consider.
It’s raised the annual dividend for 57 years on the spin.
This is another pooled vehicle with significant holdings in tech giants like Alphabet and Nvidia. But with weighty exposure to other sectors like financials, consumer goods, healthcare, and telecoms, it also holds a number of companies known for paying large and growing dividends.
Famous dividend payers in its portfolio include Unilever, Philip Morris, and Coca-Cola.
In total, the trust has holdings in around 200 companies from across the world. And so it provides superior diversification than many other investment products. But be aware that its high exposure to cyclical industries could still result in poor returns during economic downturns.
