Finsbury Growth & Income Trust: Strong, Consistent Outperformance
Edison | Mar 29, 2016 01:54PM ET
Finsbury Growth & Income Trust (LON:FGT) is a concentrated portfolio of 25-30 stocks chosen for their quality and potential for long-term growth in total return. Turnover is very low; the last complete disposal was in 2013 and the purchase of Remy Cointreau in 2015 was the first new position in the portfolio for more than four years. Performance has been very strong; FGT has outperformed the peer-group average over one, three, five and 10 years. Although not targeting a high income, FGT has a progressive dividend policy and the 2015 dividend was increased by 7.1%.
Manager Nick Train is well known for his long-term investment approach aiming to “buy great companies and hold them forever”. He seeks well-established companies with strong franchises, purchased at attractive valuations. The majority of positions are large cap and listed in the UK, but up to 20% of the NAV may be in companies listed overseas (currently 18.8%). The portfolio is concentrated with 25-30 names in just four sectors: consumer goods; consumer services; financials; and technology. More than two-thirds of the trust is invested in the consumer sectors. Gearing is modest and used for individual investment purposes rather than a means to take a view on the market.
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