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Home rules with 10 investment trusts for growth and value

Our screen selections return to the UK theme, especially small companies.
Home rules with 10 investment trusts for growth and value
  • All seven previous Alpha IT Reports are showing good outperformance against the MSCI World index and FTSE All Share.
  • The strategy’s long-term record since mid-2004 now boasts a near 10-fold return.
  • The UK is a central theme once again with five of the 10 trusts focusing on the home market.

Since November’s Alpha investment trust report, UK focused trusts have been a key theme. The report has particularly highlighted trusts focused on smaller companies and the value investment style. The same theme is very pronounced this month. Were it not for the 10 stock portfolio construction rules which limit any one mainstream theme to 5 out of the ten trust picks, we would have 6 UK trusts. 

From the perspective of the screening rules, the reason so many smaller companies trusts are showing up boils down to the simple fact that UK small caps have been racing ahead but the trusts that invest in them are trading on unexceptional valuations. The report shows just what a stand out year 2021 has so far been for UK small caps. This is illustrated by the performance of the FTSE All Small ex. IT index versus the MSCI World index, S&P 500 and FTSE All Share.

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