INVESTMENT TRUSTS
28 | SHARES | 24 May 2018
Is a fund manager lazy
if they rarely change
their portfolio?
W
ould you be happy
if the manager of a
fund in which you
had a personal investment
had only found three new
investment ideas in the past
seven years? That’s exactly
ƚŚĞƐŝƚƵĂƟŽŶĂƚFinsbury
Growth & Income (FGT), one
of the best known investment
trusts on the market.
/ŶƐƵĐŚĂƐŝƚƵĂƟŽŶ͕LJŽƵĂƌĞ
paying a fund manager to
ĂĐƟǀĞůLJŵĂŶĂŐĞĂƉŽƌƞŽůŝŽĂŶĚ
with that you’d expect them to
ďĞďƵƌƐƟŶŐǁŝƚŚŐƌĞĂƚŝĚĞĂƐƚŽ
make you money.
tŚŝůĞĚŽŝŶŐůŝƩůĞƚŽŶŽƚŚŝŶŐ
may sound lazy, some of the
best investors are the ones
ǁŚŽĚŽŶ͛ƚĐŽŶƐƚĂŶƚůLJŇŝƉŝŶ
ĂŶĚŽƵƚŽĨŚŽůĚŝŶŐƐ͘/ŶǀĞƐƟŶŐ
is a long-term game and
ƉĂƟĞŶĐĞŝƐǀĞƌLJŝŵƉŽƌƚĂŶƚ͘
The fund manager should
ƌĞŐƵůĂƌůLJĐŚĞĐŬĞdžŝƐƟŶŐŚŽůĚŝŶŐƐ
aren’t slipping out of line with
their strategy and checking that
ƚŚĞLJƐƟůůĚĞƐĞƌǀĞĂƉůĂĐĞŝŶƚŚĞ
ƉŽƌƞŽůŝŽ͘
dŚĂƚĐĂŶďĞĞƋƵĂůůLJĂƐƟŵĞ
ĐŽŶƐƵŵŝŶŐĂƐĮŶĚŝŶŐŶĞǁ
investment ideas, hence why
their fund management fees
ĂƌĞƐƟůůũƵƐƟĮĞĚ;ĂƐƐƵŵŝŶŐ
t h e y a r e w o r k i n g h a r d i n
the background).HOPING TO SCORE WITH
NEW HOLDING
Finsbury Growth & Income’s
investment into football club
Manchester United in 2017
ǁĂƐŽŶůLJŝƚƐƚŚŝƌĚŶĞǁƉŽƐŝƟŽŶ
ŝŶƚŚĞƉŽƌƞŽůŝŽƐŝŶĐĞϮϬϭϭ͘
͚/ĐŽŶƟŶƵĞƚŽďĞůŝĞǀĞƚŚĞ
lack of change is one of the
ŵŽƐƚƌĞŵĂƌŬĂďůĞĐŚĂƌĂĐƚĞƌŝƐƟĐƐ
of Finsbury Growth & Income,’
says fund manager Nick Train,
appearing at the Frostrow
Capital investor event on
16 May.
He recalls a comment by Jessie
Livermore, one of the world’s
ŵŽƐƚŝĐŽŶŝĐĂŶĚŝŶŇƵĞŶƟĂů
ƚƌĂĚĞƌƐŽĨĂůůƟŵĞ͚͘/ƚǁĂƐŶĞǀĞƌ
my thinking that made big
money for me. It was always
ƐŝƫŶŐ͘'ŽƚƚŚĂƚ͍DLJƐŝƫŶŐ
ƟŐŚƚ͛͘dŚŝƐŝƐŽŶĞŽĨ>ŝǀĞƌŵŽƌĞ͛Ɛ
famous quotes.
͚^ŝƫŶŐƟŐŚƚŝƐŶŽƚĞĂƐLJƚŽĚŽ͕͛
remarks Train. ‘We’ve had to
work hard to learn how to do
this well.’
Lindsell Train-managed
Finsbury Growth & Income has
achieved 15.3% annualised total
return over the past 10 years
versus 6.6% from its benchmark.
This superior track record is
one of the reasons why we
highly rate the investment trust
and believe it should be a coreFinsbury Growth & Income has only added three new names to its portfolio since 2011The investment trust has a stake in Unilever
which owns food and drink brands including
>ŝƉƚŽŶ͕&ůŽƌĂĂŶĚŽƌŶĞƩŽ