The second most popular sectors were the Global and UK Equity Income sectors, which accounted for 16 per cent and 10 per cent of shares respectively in the second quarter, up from 16 per cent and 13 per cent in the first quarter.
Greater demand for investment trusts will need to be met with greater availability. One of the most common complaints by advisers about investment trusts previously was that they were not available on many platforms. Fidelity has been the most recent provider to answer this call - starting from early December Fidelity’s platform FundsNetwork will offer a broad range of the most popular investment trusts, as well as some exchange-traded products (ETPs).
Jon Everill, head of FundsNetwork advisory services, says, “Investment companies form an important part of the spectrum of products that advisers have available to them via platforms. In many cases their unique features and benefits suit particular clients extremely well. A combination of evolving client needs and more awareness of the different product types on the market is helping support a growing interest in investment companies.
“The RDR has reaffirmed the already well established requirement for independent advisers to consider a wide variety of investments for their client, including investment trusts,” Mr Everill continues.
Providers that will be added to the platform will include trusts from Aberdeen, Baillie Gifford, Invesco Perpetual, and JP Morgan, as well as all five investment trusts from Fidelity. Along with the ETPs, these new investments will be fully integrated with the existing range of services and will be available in the ISA, Investment Fund Account, and the FundsNetwork Pension.
Steady as she goes
The changes have not been as fast and furious for all areas of investment trusts. James de Sausmarez, director and head of investment trusts at Henderson, called the changes he had seen so far as “modest”, observing that many advisers are dealing less directly with investments and instead outsourcing this area of their business to wealth managers. Private investors have also been keen on investment trusts and are usually very well informed about what they are looking for in a trust.
Mr de Sausmarez says, “Among the adviser community there has been increased interest from independent financial advisers. Not purchases yet but this increased interest may lead to more purchases in the future.” He said that his priority is to grow existing investment trusts and make them more liquid by issuing more shares rather than launching new trusts.
Though it has taken advisers some time to turn to investments trusts this uptake in interest is not likely to wane anytime soon. Nick Britton, head of training at the AIC, cited the Woodford launch as one of the reasons that many are taking a new interest in trusts, but that even without the launch he has witnessed a great deal more demand.
