Alliance Witan: April 2026 investment trust update

• In October 2024 Alliance Trust merged with Witan investment trust to create Alliance Witan

• Willis Towers Watson hunt for who they believe to be the best stock pickers and blend their best ideas to create a diversified portfolio of shares

• The trust’s impressive dividend record continued after an increase for the 59th consecutive year

How it fits in a portfolio

Alliance Witan aims to grow an investment over the long term by investing in companies from around the globe. While larger companies from developed markets are the primary focus, it also invests in higher-risk smaller companies and emerging markets.

Historically, the trust invested in a range of different assets alongside company shares, such as bonds, mineral rights, and private equity. Today it adopts a multi-manager approach, where portions of the trust are run by different fund managers, and it’s solely focused on shares. The multi-manager approach means there's plenty of diversification on offer compared to other global equity funds or investment trusts, especially as many managers used by the trust aren’t easily available to UK retail investors. The trust could be used to bring international diversification to a UK-focused investment portfolio.

Investors in closed-ended funds should be aware trusts can trade at a discount or premium to their net asset value (NAV).

Manager

The portfolio of shares is managed by different teams of fund managers, most of whom aren’t accessible to individual UK investors. Each brings their own strengths, styles, and areas of focus, which are carefully blended together to create a diversified portfolio. Each team invests in approximately 20 companies. Some are able to choose companies from anywhere in the world, while others focus on a particular region like Japan or emerging markets.

The managers are selected by the Investment Committee at Willis Towers Watson. The committee is chaired by Craig Baker, Global Chief Investment Officer, who is supported by co-managers Stuart Gray and Mark Davis. The committee can tap into the expertise of a large team of analysts and portfolio managers from across the globe.

Process

The Investment Committee believes that the majority of stock pickers outperform with their highest conviction investments but hold back returns with their smaller investments. That’s why they only let most of the underlying managers invest in their 20 best ideas. This number is big enough to spread risk but is also a manageable number of companies for each manager to follow closely.

To whittle down the universe of fund managers, the research team conduct detailed analysis to ensure managers meet their criteria. Managers must possess a competitive advantage and be able to maintain this edge to perform well over the long term. The most important aspect is the people themselves. That’s why the committee spend a great deal of time understanding their motivations, experience, and who’s influenced them throughout their careers. The committee also consider how these managers are aligned with their investors, whether that be through equity in the business they work for or a significant co-investment in the funds they manage.

Information is widely available so it’s critical for them to understand how these managers are using it better than others. Whilst the number crunching and length of their track record is important, judgement is largely made through qualitative work. The Investment Committee get great access to meeting stock pickers, reading their research, and are able to sit in on company meetings. This work is ongoing, and they will meet with managers numerous times before taking a view.

There are currently 11 different managers blended together by the Investment Committee, ensuring there isn't too much risk at a company, sector, or geographical level. They also want to maintain a balanced portfolio in terms of investment styles.

There were two changes to the trust’s underlying managers in the past year. Artisan Value replaced ARGA due to ARGA experiencing some operational challenges and, following some personnel changes, SGA were replaced by Brown Advisory. Both managers added to the trust invest in the same style as the one they replaced. The team at Brown Advisory looks for companies with a strong competitive advantage that can generate high returns on capital. The fund managers at Artisan Partners aim to identify quality companies, mostly based in the US, where short-term headwinds are causing shares to be cheaper than their true value.

North America accounts for the largest portion of the trust at 55.6%, although this is less than in the benchmark. In contrast, they invest more in Europe and the UK. Sector-wise, the largest allocations are to financials, technology, and industrials companies.

The trust uses gearing (borrowing to invest) to try to boost returns. Gearing at the end of December 2025 was 6.3%. Gearing can also increase losses though, so it’s a higher-risk approach. Managers can use derivatives to help manage the trust, which increases risk.

Culture

Alliance Trust was founded in 1888. In October 2024 the trust merged with Witan Investment Trust to create Alliance Witan. This meant several changes to the board of directors however Dean Buckley remains chair. There have been no changes to the process or philosophy following the merger, just a larger pool of assets for Willis Towers Watson (WTW), to manage. Previously the trust was a constituent of the FTSE 250 but following the merger it was promoted to the FTSE 100.

WTW is a large consultancy firm with over 45,000 employees across 140 countries. This is the first investment trust they’ve managed but WTW has invested this way for much longer on behalf of institutional clients. When selecting managers, they pay close attention to the underlying culture, alignment, and operational resource of the firms they work for.

ESG Integration

Although the trust doesn’t have a sustainable mandate, WTW ensure the underlying managers have a demonstrable framework in place to identify and monitor environmental, social, and governance (ESG) factors for the companies they invest in.

WTW allow the individual managers to manage these risks as they see appropriate, as long as there’s a suitable framework in place. In 2021, the board also set a target of net zero greenhouse gas emissions from the trust by 2050. Each asset manager the trust uses must have also set a net zero target.

Cost

The ongoing annual charge over the trust’s financial year to 31 December 2025 was 0.47%, a decrease from 0.56% in the previous year. Investors should refer to the latest annual reports and accounts, and Key Information Document for details of the risks and charging structure.

We recently made some changes to the amount clients pay to invest with us. Find out more about these changes.

The annual charge to hold investment trusts in the HL ISA, SIPP, or Fund & Share Account is 0.35% (capped at £150 p.a. in each account) and 0.25% in the HL Lifetime ISA (capped at £45 p.a.). There are no charges from HL to hold investment trusts within the HL Junior ISA. As investment trusts trade like shares, both a buy and sell instruction will be subject to the HL share dealing charges.

Performance

Since WTW was appointed as manager in April 2017, the trust has generated returns of 110.70%*. This trails the 156.53% of the MSCI ACWI benchmark but is ahead of the average trust in the AIC Global peer group, which returned 91.98%. Over the same period, the trust’s NAV increased 110.68%. Past performance isn’t a guide to the future.

Over the trust’s last financial year, to the end of 2025, it returned 5.39%. It’s NAV grew 4.70%. Both figures were behind the benchmark and sector average, which returned 14.41% and 8.11% respectively.

Given the underlying managers use a variety of different investment styles, it’s expected they won’t all perform similarly. The top performing manager in 2025 was Dalton Investments, who primarily invest in Japanese companies. Among Dalton’s top stock picks was Fuji Media Holdings. Investments made by Artisan Partners also performed well for the trust, after Artisan was added as a manager in September.

GQG, who are responsible for the trust’s investments in emerging markets, were the biggest detractor to performance. GQG sold some investments in technology companies, believing them to be expensive and that excitement over AI had run its course. However, these companies continued to show strong momentum throughout the year.

Companies that contributed the most to the trust’s performance over the past year include low-cost airline Ryanair, US-based energy provider NRG, and French aerospace company Safran.

The trust paid a total dividend per share for the year to December 2025 of 28.3p, a 6.1% increase from the previous year. The trust is an AIC ‘dividend hero’ and has increased its dividend for 59 consecutive years. The trust has a dividend yield of 2.26%, although yields are variable and aren’t a reliable indicator of future income.

At the time of writing the trust trades on a 3.97% discount, which is lower than the 4.8% average discount over the trust’s last financial year. Its also lower than long-term average discount of 5.57%. All investments fall as well as rise in value, so you could get back less than you invest.