The lion’s share of my surplus cash each month is used to purchase stocks, investment trusts and exchange-traded funds (ETFs) on the stock market. History shows that holding too much money in a low-risk, low-return cash accounts can leave a hole in an individual’s pension pot.

A £37k shortfall

Fresh research from Moneybox underlines the size of this potential shortfall. It highlights “a £37,000 difference in average investment holdings between financially confident individuals and those who lack confidence, regardless of income.

It says that “investments have historically outperformed cash over time,” but that a lack of confidence and financial education is impacting demand for riskier assets.

Moneybox says that investment confidence among Britons has risen to 39% in 2025 from 33% last year. However, confidence in saving remains far higher, at 84% today versus 79% in 2025.

The financial services provider notes that “this contrast is highlighted by the fact that since the start of 2025, only 11% of individuals have transitioned money from savings into investments.”

Better returns

The added risk that accompanies share investing is why — understandably — many people are drawn to savings accounts. Unlike cash savings, the value of stock investments can fall as well as rise over time.

Yet while past performance isn’t always a reliable guide, share investing has over time proved a powerful way to control risk while still delivering strong returns. According to Moneyfacts, the average Stocks and Shares ISA investor has enjoyed a 9.64% average annual return since 2015.

That figure sits way back at 1.21% for Cash ISA users.

Harnessing shares with investment trusts

Furthermore, modern investors can choose from a wide range of assets to mitigate risk. They can purchase lower-risk shares like utilities, defence contractors, and manufacturers of consumer staples to limit volatility.

They can also build a diversified portfolio spanning different sectors and regions to spread risk. Investment trusts like Personal Assets Trust (LSE:PNL) offer a simple (and low-cost) way to achieve this kind of resilience.

Since 2015, it’s delivered an average yearly return of 5.5%. That’s far ahead of what a Cash ISA saver would have made over the period.

The trust has achieved this thanks to a strong rating of equities of equities. Just under 40% of it is tied up in global shares, but its holdings are well diversified. What’s more, less than 5% of it is tied up in one single company, which reduces concentration risk.

The remainder of the fund is locked up in safe-haven assets like gold, government bonds and cash, which balances investor risk and helps provide a smooth return across the economic cycle.

Personal Assets Trust remains vulnerable to broader movements on stock markets. But I think it’s still a great investment trust to consider to manage risk and target super returns.

The post Here’s how UK shares could boost savers’ wealth by £37k! appeared first on The Motley Fool UK.

Changes could be announced as soon as Chancellor of the Exchequer Rachel Reeves’ Mansion House speech on 15 July, according to the Financial Times.

By considering altering the ISA regime, Reeves wants to get the UK investing in riskier assets such as shares. In doing so, she hopes that:

• Britons will achieve better long-term returns than savings accounts typically offer.
• The UK economy will receive a boost from higher investment flows.
• The London Stock Exchange will enjoy a revival in trading volumes and new listings.

Reeves said earlier this year that she wants to foment “a culture in the UK of retail investing like what you have in the US”. In the States, more than 60% of people own shares. That compares with around 20% in Britain.

Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice. Readers are responsible for carrying out their own due diligence and for obtaining professional advice before making any investment decisions.

What are the options?

Given the superior returns on offer from share investing, I believe Britons should give the stock market greater consideration when planning for retirement. However, that’s not to say I think the government is right to encourage this by cutting Cash ISA allowances!

It’s important to note that even if allowances are changed, Britons will still be able to keep saving cash as usual.

Individuals will still be able to make regular contributions to one of these tax-efficient products, though the annual savings is likely to be lower. People will also still be able to use standard savings accounts to keep cash, but tax will be due on interest that exceeds personal allowances.

However, now could be a good time for Britons to consider the other options available to them. With the Stocks and Shares ISA, individuals can choose from a wide range of shares, trusts and funds that cater to a wide range of risk profiles.

Low-risk investing

Take the Personal Assets Trust (LSE:PNL), for instance. Like many UK investment trusts it owns a selection of UK and global shares. But its portfolio consists of 18 separate companies spread across different sectors and regions, a strategy that greatly reduces risk.

What’s more, less than 40% of the fund is tied up in the stock market. Instead, the majority of its capital is invested in classic safe-haven assets like government bonds, cash and precious metals — gold bullion is in fact its largest single holding:

Naturally, a trust with stock market exposure carries higher risk than a Cash ISA, and especially during economic downturns. But over the long term, trusts like this can still deliver strong returns.

The average annual return from Personal Assets Trust is 5.4% since 2015, beating the Cash ISA average of around 1.2%. This makes it worth serious consideration, by illustrating how regular savers can put their money to work effectively without having to take on lots of added risk.

The post Should savers switch to the Stocks and Shares ISA if Cash ISA limits fall? appeared first on The Motley Fool UK.

These tax savings have helped Stocks and Shares ISAs deliver an annual return close to 10% over the last decade. Yet despite these benefits, many Britons remain reluctant to use them due to their higher risk profile. The recent panic over rumoured cuts to Cash ISA allowances to encourage share investing is evidence of this.

Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice. Readers are responsible for carrying out their own due diligence and for obtaining professional advice before making any investment decisions.

But investing on the stock market doesn’t have to involve taking on uncomfortable levels of risk. And with the poor returns on offer from Cash ISAs — the average annual return since 2015 is just over 1% — I myself believe using a Stocks and Shares ISA too is a no brainer (it’s why I currently use both types of account to target large returns and manage risk).

Getting personal

Investors can spread the risk they face by purchasing exchange-traded funds (ETFs) or investment trusts.

Pooled investments like these can allocate capital across a wide range of assets, with investors choosing the one that best balances their desired return and tolerance of risk. The Personal Assets Trust (LSE:PNL) is one such vehicle I think is an attractive way for ISA investors to consider building wealth.

More than a third (36%) of the trust is locked up in shares, its single most represented asset class. Major holdings here include UK and US blue-chip shares Unilever, Microsoft, Visa, and Diageo. That also adds risk linked to the performance of individual shares (like Diageo, which has been weak recently).

However, the rest is allocated to classic, stable assets like government bonds, precious metals and cash. As a result, investors still enjoy relative low levels of volatility, as the chart below shows:

Substantial safe-haven holdings today include gold bars (10.6% of the trust), US inflation-protected government bonds (26%) and short-dated Gilts (10%).

Since 2015, the fund has delivered an average annual return of 5.3%. That’s far better than a basic cash savings account has provided in that time.

Holy moly

Investors chasing better returns can achieve this by considering trusts with greater allocations to equities. This involves more risk risk, though vehicles which invest across sectors and regions can still substantially reduce the danger to individuals’ cash.

Take the Monks Investment Trust (LSE:MNKS). The average annual return here is a brilliant 10.3%, achieved across scores of different companies (105 today) spanning the globe:

Major holdings here include the ‘Magnificent Seven’ Microsoft, Meta, Amazon and Nvidia. These companies can be volatile during economic slowdowns, but over the long term have provided strong returns as the digital economy has grown.

With management by financial services giant Baillie Gifford, investors

Both trusts expose investors to risks such as rising interest rates and market declines. Yet as their long-term performances show, they can still be a great way for cautious investors to generate long-term wealth and I think they’re worthy of further research.

The post Looking to de-risk a Stocks and Shares ISA? Consider this! appeared first on The Motley Fool UK.

Could we see a crash before the year’s out? It’s possible. Sooner or later there’ll be one. But I wouldn’t let that stop me buying stocks today. Here are three I’d be particularly comfortable owning even if markets were to crash tomorrow.

Government-backed income

Primary Health Properties (LSE: PHP) invests in primary healthcare facilities in the UK and Ireland. Its latest acquisition is quite typical, being a modern purpose-built facility, fully let to a substantial GP practice and a pharmacy. This acquisition increases its portfolio to a total of 519 assets.

The properties are let on long leases and most of the rental income is backed, directly or indirectly, by the UK and Irish governments. The lease duration and tenant profiles give PHP an exceptionally secure rental income stream.

The company pays quarterly dividends. These have totalled 6.2p for 2021, giving a yield of 4.1% at the current share price. This is the 25th consecutive year of dividend growth.

One downside risk for PHP is that the appeal of the primary health property sector is attracting new purchasers, meaning the group is facing increased competition for viable opportunities. Nevertheless, management believes PHP “remains exceptionally well positioned to deliver low-risk sustainable shareholder returns”.

Flight to safety

Gold often does well when stock markets crash. This is one reason why I’d be happy to buy Endeavour Mining (LSE: EDV) today. The company has six producing gold mines across Burkina Faso, Côte d’Ivoire and Senegal. It also has a strong portfolio of advanced development projects.

Nevertheless, I need to be aware that operational setbacks are a risk with miners and can hurt earnings and dividends. Having said that, the impact on multi-asset EDV would be lower than for a single-asset producer.

The company has an attractive progressive dividend policy. It’s set minimum payouts for 2021 ($125m), 2022 ($150m) and 2023 ($175m). At the current share price, these equate to yields of 2.1%, 2.5% and 3%.

But there’s a further element to the dividend policy. Distributions may be supplemented with additional dividends and share buybacks, providing the prevailing gold price remains above $1,500 per ounce and the company’s leverage remains low. It’s currently buying back shares.

One-stop shop

A third stock I’d be more than comfortable buying today, regardless of the risk of a market crash tomorrow, is Personal Assets Trust (LSE: PNL). The trust has a long history of successfully meeting its investment objective “to protect and increase (in that order) the value of shareholders’ funds per share”.

It does this by diversifying not only across equities, but also other assets. Equities currently account for 41.4% of its portfolio. Its top five stock holdings are Microsoft, Alphabet, Visa, Nestlé and Unilever. Meanwhile, it has 30.3% in US index-linked bonds, 20.3% in cash and UK treasury bonds, and 7.9% in gold bullion.

PNL’s multi-asset positioning mitigates the impact of a stock market crash. But on the other side of the coin, there’s the risk — almost an inevitability — that it will underperform in rampant bull phases of equity markets. I also need to be aware that it has an extremely conservative dividend policy and a current yield of just 1.1%.

The post Stock market crash incoming? I’d buy these 3 UK shares regardless! appeared first on The Motley Fool UK.

Here, I’ll look at the pros and cons of the available options. And tell you about my one UK stock for life.

How I wouldn’t invest £500

First off, let me say I’m not a gambler. I don’t look at the stock market as a casino and wouldn’t punt my £500 on a to-the-moon-or-bust ‘story stock’.

I might just win big, but there’s a high risk of blowing my money completely. A permanent loss of capital — even the relatively small sum of £500 — can be costly over a lifetime.

A better option

If I wouldn’t invest £500 in a story stock, how about a well-established profitable business? That’s more like it, in my book. But there’s still a risk I could pick a company that turns out to be a dud. For example, Carillion, Debenhams and Thomas Cook have all gone bust and wiped out their shareholders in recent years.

If pushed, I’d pick a global business with strong, consumer staples brands and reliable cash flows. I think Unilever is a good example. However, there’s another approach I could take to invest my £500.

One-stop-shop diversification

As mentioned earlier, there are numerous investment companies listed on the stock market. Most of them invest in a range of other companies. This one-stop-shop ‘diversification’ reduces risk, and appeals to me.

However, I still have scores of investment companies to pick from. Should I go for an industry specialist, like Polar Capital Technology Trust? How about a country specialist, such as Fidelity China Special Situations? Or would I be better off picking a company that invests across many industries and countries, like Monks Investment Trust?

The one stock I’d invest £500 in for life

Personal Assets Trust (LSE: PNL) sits well with my attitude to risk and reward. Its policy is to “protect and increase” (in that order) the value of my investment. Its holdings are diversified across the four traditional asset classes: equities, bonds, gold and cash.

At its last financial year end, 43% of PNL’s portfolio was in equities. Its top 10 holdings included Microsoft, Visa, andNestlé. Bonds represented 41% of the portfolio. It also had 11% exposure to gold and held 5% cash.

PNL reported on its long-term performance. Since 1990, it’s grown its net asset value at a compound annual growth rate of 7% compared to 4.4% for the FTSE All-Share index and 2.8% for RPI inflation.

PNL’s share price is £485, as I’m writing. This means I could buy one share with my £500! If PNL were to reproduce its historical growth rate for the next 60 years, my little ol’ £485 share would be worth over £28,000 (or £5,740 in real terms, adjusted for inflation). It’d count that as a decent return on my investment.

Of course, past performance is not necessarily a good guide to the future. My £485 share may not increase in value as calculated above. However, I think there’s a very low risk of losing my capital. This is because of PNL’s diversification across and within different asset classes.

The post How I’d invest £500 if I could only buy one UK stock for life appeared first on The Motley Fool UK.

With that in mind, today, I’m going to take a look at one share I think could be the perfect investment for the next market decline. 

Stock market crash investment

If you have £5,000, or any other amount to invest, it could be worth considering the Personal Assets Trust (LSE: PNL) for your portfolio. Now, strictly speaking, this isn’t a single share. It’s an investment trust which owns a basket of different assets.

The structure might put some investors off, but I think it’s the trust’s most significant advantage. If you’re not put off by the structure, it may be worth considering this investment instead. 

The single overriding aim of the trust’s management is to protect and grow shareholder capital over the long term. We only need to look back at the last stock market crash earlier this year see just how well management has been able to accomplish this aim.

In March and April, when the FTSE All-Share slumped by nearly 40%, shares in Personal Assets declined by just 10% before staging a healthy recovery.

Year-to-date, shares in the investment trust have risen by 6%, compared to a loss of 23% for the FTSE All-Share, excluding dividends. Put simply, the trust took the stock market crash in its stride. 

Over the past five years, it has produced an even better performance. Since the beginning of October 2015, Personal Assets has outperformed the FTSE All-Share by 40% excluding dividends. 

Defensive portfolio

Personal Assets’ goal to protect and grow shareholders’ capital has lead the business to operate a defensive portfolio. Around 50% of assets are invested in high-quality shares, companies like Microsoft. The rest of the portfolio is made up of high-quality bonds and precious metals. 

This split between bonds, gold and growth stocks, helped the trust ride out this year’s stock market crash. It then benefited from the market recovery in the weeks after. 

Thanks to its defensive positioning, I reckon it’s highly likely Personal Assets will be able to repeat this performance the next time around. And if there isn’t another market slump, then its allocation towards equities will help the trust benefit from the market rally. 

The bottom line

All in all, if you’re looking to invest a lump sum in the stock market today, Personal Assets could be the best investment to buy now. The outlook for stocks and shares is highly uncertain, so the best way to invest in this market may be to adopt a conservative position. That’s precisely what Personal Assets has done.

As we have seen this year, the conservatives positioning should allow the firm to profit whatever the future holds for the stock market and investors around the world.

The post £5k to invest? Here’s one share I’d buy for the next stock market crash appeared first on The Motley Fool UK.

Indeed, there are many risks to the market recovery on the horizon and even in recent days we’ve seen markets falling again.

A second wave of coronavirus, a sluggish economic recovery or a wave bankruptcies as companies struggle under the burden of debt built up during the crisis, could send investor sentiment plunging once again and cause yet another stock market crash this year.

As such, now may be an excellent time to prepare for a second stock market crash. And there’s one stock in particular that could help investors weather the storm, I feel.

Stock market crash round two

Personal Assets Trust (LSE: PNL) invests with the single goal of protecting and growing investors’ capital over the long term.

It has accomplished this aim in 2020. Shares in the investment trust have gained 4% year-to-date. That’s compared to a loss of 16% for the FTSE 100 in the stock market crash.

The performance of the trust is just as impressive over the long run. Over the past five years, it has returned 27% excluding dividends. That’s compared to a loss of 7% for the FTSE 100 over the same period excluding dividends.

This track record suggests Personal Assets could help protect investors’ wealth if a second stock market crash arrives.

Strong portfolio 

The trust’s secret is its asset allocation. Most of the portfolio is invested in inflation-linked bonds. These provide a steady above inflation return over the long run. Gold, a great asset to own in any stock market crash, also makes up a large percentage of the portfolio.

Equities also feature in Personal Assets’ portfolio. Stock make up about 44% of assets and the investment company is very strict about choosing companies to fit into this investment portfolio. It will only own high-quality, defensive businesses with strong balance sheets that should continue to benefit from cyclical tailwinds. Microsoft, Nestlé, and Unilever are currently its largest holdings.

The large allocation towards bonds may mean that the trust does not perform as well as equity indexes such as the FTSE 100 and FTSE 250 over the long term. However, it also means that the trust does not suffer as much as these indexes in the event of a stock market crash. In times of uncertainty, this sort of protection is invaluable.

As it is impossible to tell what the future holds for the stock market, and if there will be a second stock market crash in 2020, owning Personal Assets as part of a diversified portfolio could be a sensible financial decision. Its extensive positive track record also suggests that the fund may help you grow your financial nest egg over the long run.

The post The second stock market crash of 2020 could be coming. I’d buy this stock appeared first on The Motley Fool UK.

This is a great advantage at a time when many other businesses are having to cut dividends to conserve cash. 

Furthermore, investment trusts have more options when it comes to selecting investment assets. They can own stocks, bonds, real estate, precious metals, cash, and many other different asset classes.

Investment trusts to buy

Personal Assets Trust (LSE: PNL) is an excellent example of the diversity of investment trusts. This firm was set up with the single goal of protecting and growing private investors’ capital over the long term. And management appears to be meeting this goal.

The trust, which currently supports a dividend yield of 1.3%, has lost around 4.7% this year. However, the FTSE All-Share has lost around 30% over the same time frame. 

Personal Assets’ portfolio is stuffed full of defensive assets. The most significant position in the portfolio right now is gold. It makes up 9% of assets under management. Cash makes up 5%, and fixed-income securities make up around half of the portfolio.

Are you looking for an investment trust to add to your Stocks and Shares ISA in this market crash? I think it might be worth taking a closer look.

Henderson International Income Trust

With that dividend yield of just 1.3%, Personal Assets doesn’t offer much in the way of income. So investment trusts with an income focus could be the better option for income-seeking investors. Especially those with a long-term time horizon. I think Henderson International Income Trust (LSE: HINT) is a great option here.

With a current dividend yield of 5%, Henderson’s income offering looks attractive in the current interest rate environment. It’s now dealing at a slight discount to net asset value. But historically, the trust has commanded a premium to net asset value.

Some of the most attractive income stocks in the world feature in the portfolio. These include Microsoft and consumer goods giant Nestle. International equities make up almost all of the portfolio. 

Put simply, if you’re looking to buy a diversified international income stream, this could be one of the best investment trusts out there.

Henderson Smaller Companies Investment Trust

For investors looking for exposure to fastest-growing small businesses, Henderson Smaller Companies (LSE: HSL) has an excellent track record of picking winning stocks.

Investing in small growth companies is a risky business. Therefore, gaining exposure to the sector through investment trusts is a great way to reduce risk while profiting from company growth at the same time.

Henderson has 105 different holdings in its portfolio. It charges an annual management fee of just 1.42%. On top of this, the trust supports a dividend yield of 2.6%. The distribution has risen every year since 2000. That’s nearly 20 years of consecutive dividend increases.

Today, investors can buy this trust at a discount of 5% to net asset value. If you’re looking for a way to invest in small-cap growth businesses, without having to pay a hefty fee, Henderson’s offering appears to tick all the boxes.

The post Three investment trusts I’d buy for my ISA in this market crash appeared first on The Motley Fool UK.

This is a challenging environment for investors to navigate. However, there are a couple of funds that stand out right now as safe harbours in rough waters.

Personal Assets Trust

The Personal Assets Trust (LSE: PNL) is a relatively unique investment trust. Its goal is to protect and grow the wealth of its investors over the long term. Management places emphasis on the protection part of its investment mandate.

As such, inflation-linked bonds and precious metals feature heavily in the trust’s portfolio. Commodities and fixed income securities currently make up more than two-thirds of the collection. The trust also owns a selection of high-quality blue-chip stocks.

If you’re looking for an investment fund that’s trying to beat the stock market, Personal Assets isn’t for you. However, if you’re looking to protect and grow your wealth, it could be worth considering.

Over the past 10 years, it’s achieved an average annualised return of 5.8%, with relatively minimal volatility.

A dividend yield of 1.3% provides a level of income that exceeds most savings accounts, and an annual management fee of 0.65% is relatively low.

Scottish Investment Trust

The Scottish Investment Trust (LSE: SCIN) is another trust that’s structured to outperform in all market environments, billing itself as a contrarian investor. It likes to buy out-of-favour stocks, which are in the process of restructuring. It also aims to provide dividend growth ahead of UK inflation.

Research shows value stocks tend to outperform in volatile markets. Meanwhile, growth stocks suffer the most as investors usually rush to sell these holdings first. This suggests Scottish could produce market-beating returns in the current environment.

Indeed, the most substantial holdings in the trust’s portfolio as some of the most defensive stocks around. These include Tesco, gold miner Newcrest and GlaxoSmithKline.

Management has also shown willingness to deploy extra capital repurchasing shares when they’re trading a significant discount to net at a value, which enhances returns over time.

The investment trust currently supports a dividend yield of 3.1%, is trading at an 11% discount to net asset value, and charges just 0.58% per annum in management fees.

Henderson International Income Trust

The great thing about dividend stocks is that they can give you a steady income in times of market volatility. That’s why the Henderson International Income Trust (LSE: HINT) has to feature on a list of top investment trusts to buy in the current environment.

It owns some of the most highly-regarded income stocks in the world, including Microsoft, Coca-Cola and Nestle. It currently offers a dividend yield of 3.7% and is trading at a slight discount to the net asset value.

Since the trust was launched in 2011, its net asset value as grown by nearly 90%, including dividends.

That suggests this trust can provide a steady return for investors in all marketing environments. With an annual management fee of 0.84%, it doesn’t charge the world for this performance either.

For long-term dividend-focused investors, this trust seems to tick all the boxes.

The post 3 investment trusts I’d buy in the current market crash appeared first on The Motley Fool UK.

Buffett hasn’t been dumping all his equity holdings — he continues to see value in some stocks — but the corollary of a broad market overvaluation is an elevated risk of a market crash.

If you’re looking to increase the defensive qualities of your portfolio, or are a new investor wanting to get started in the stock market but worried this could be exactly the wrong time, I think the two stocks I’m looking at today — Personal Assets Trust (LSE: PNL) and Capital Gearing Trust (LSE: CGT) — are well worth considering. Indeed, I’d be happy to buy both for 2020, whatever the stock market has in store for us.

Protection and firepower

Like Buffett’s Berkshire Hathaway group, Personal Assets and Capital Gearing aren’t constrained geographically or restricted to holding only equities. And like Buffett, the two trusts’ managers see value in some stocks, but a broad overvaluation in equity markets.

Both trusts currently have a 32% exposure to equities and large holdings of cash and low-risk liquid assets. As such, in the event of a continuing bull run in equities, shareholder returns at Personal Assets and Capital Gearing aren’t going to shoot the lights out.

However, in the event of a crash, they’re positioned to offer a good bit of protection. It’s notable, for example, that since 2000, despite the crashes of the dotcom bust and great financial crisis, Capital Gearing’s maximum ‘drawdown’ (share price decline from peak to trough) has been just 9%.

Furthermore, if there is a market crash, the two trusts — like Buffett — have considerable firepower to snap up equities at bargain-basement prices. For example, Personal Assets’ exposure to equities was over 70% coming out of the financial crisis, compared with 32% today.

Diversification

The reason I’d be happy to buy both trusts is, while they each currently have a 32% exposure to equities, there is diversification in the equities they hold, as well as in the make up of their other assets.

In equities, Personal Assets favours a high-conviction portfolio of individual stocks. Its top five holdings are Microsoft, Nestlé, Unilever, Coca-Cola and British American Tobacco. Capital Gearing holds some individual stocks, but is focused more on whole-market trackers and other collective investments. Its top five holdings are iShares Core FTSE 100 ETF, Vanguard FTSE Japan UCITS ETF, Grainger, Investor AB and North Atlantic Smaller Companies.

There are also differences in the two trusts’ fixed income portfolios. For example, both have over a third of assets in index-linked government bonds, but Personal Assets is heavily skewed to the US, while Capital Gearing is a little more diversified. Similarly with gold, the former trust has a 9% exposure and the latter 1%.

Bottom line

To summarise, if you’re looking to add some defensive qualities to your portfolio, I think Personal Assets and Capital Gearing are well worth considering. Meanwhile, if you’re a new investor wanting to get started in the stock market, but reluctant to go ‘all-in’, I think these two trusts offer a good compromise.

The post Fear a stock market crash? I’d buy these 2 stocks for 2020! appeared first on The Motley Fool UK.