Investment trusts are one of the best assets to buy if you want an experienced manager to manage your wealth with little to no effort on your part.
What’s more, unlike many other funds, investment trusts are not limited in the assets they can hold, which allows managers to seek out the best ones to buy all over the world. And some investment trusts have been around for 100 years or more, so they have a lengthy record for investors to consider before buying.
A global outlook
EP Global Opportunities Trust (LSE: EPG) is UK-listed with a worldwide mandate. Since inception in December 2003, it has achieved a compound annual return for investors of just under 10.1% by investing globally in undervalued securities.
EP Global’s broad investment mandate allows it to invest where many other funds would be afraid to tread. For example, of its top 10 holdings, only three are UK based (four including Royal Dutch Shell, although EP owns the A shares which are domiciled in the Netherlands). Non-UK holdings include pharmaceutical giant Novartis (Switzerland), Bank Mandiri (Indonesia), Commerzbank (Germany) and Shanghai Fosun Pharmaceutical (China). Together, the top 10 holdings account for just under 30% of assets and provide a great play on global growth trends.
The net asset value of EP Global is 345p per share at the time of writing, so today the shares are trading at a discount of around 5%. As well as this discount, the shares offer a yield of 1.3%. The management fee is 1% per annum.
Overall, if you’re looking for a play on global growth that’s got a track record of double-digit returns behind it, EP Global seems to me to be the perfect buy.
Private equity profits
Another trust I like the look of is ICG Enterprise Trust (LSE: ICGT). ICG is a private equity business, so its business model varies significantly from that of EP Global, but that hasn’t stopped the company from beating the market.
During the past decade, shares in the fund have returned 123.9%, excluding dividends, compared to the FTSE All-Share Index return of 78.4%.
According to the investment company’s results for the three months to the end of October, which were published today, it produced a total return of 9.1% for investors over the nine months to the end of the period, thanks to some key disposals and cash returns. Management is targeting a 20p per share dividend for the end of the year, as well as a share buyback.
As it sells down some investments into a seller’s market, ICG is re-investing some of its proceeds into new opportunities such as the co-investment of £8.1m in Visma, provider of accounting software and business outsourcing services, alongside peer fund ICG Europe VI.
So all in all, if you’re looking for a trust that’s got a record of beating the market by investing in unquoted securities, that’s also returning funds to investors, IGC ticks all the boxes.
