In 2010 Caledonia Investments (CLDN) appointed a new chief executive, Will Wyatt, who undertook a review of the trust's strategy and made a number of changes. And the trust's results for the year ended 31 March 2014 suggest this policy is bearing fruit, with a net asset value (NAV) return of 14.9 per cent against 8.8 per cent for the FTSE All-Share. It is the second year of improved performance.
"We had a long tail of small investments which never made an overall impact and all that effort finding and managing them would have been better spent on larger businesses," explains Mr Wyatt. "We actively sold the smaller positions, and as these are less liquid it took some time. We have a few left but the process is well under way.
"We also raised the income we get, and have made it far more sustainable and robust by building up specialist pools, and adding some large high-yielding shares."