City of London: November 2025 trust update

• Job Curtis is one of the most experienced UK equity income investors and began managing this investment trust in 1991

• The trust aims to provide long-term growth in income and capital by mainly investing in large UK companies

• The trust has increased the dividend it’s paid to investors for 59 years, an investment trust record

How it fits in a portfolio

City of London Investment Trust aims to provide long-term growth in income and capital by mainly investing in large UK companies. Job Curtis, the trust’s manager, looks for companies that generate plenty of cash to pay dividends and are conservatively run, in his view. This trust could form part of an income investment portfolio or a broader portfolio looking to add investment in larger UK companies.

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

Manager

Curtis has managed City of London Investment Trust since July 1991. This tenure is rare to see. He began his career in 1983 as a graduate trainee at Grieveson Grant stockbrokers, before joining Cornhill Insurance as an assistant fund manager from 1985 to 1987 and then Touche Remnant as a unit trust and investment trust manager. Following Henderson’s acquisition of Touche Remnant he subsequently joined Henderson (now Janus Henderson) in 1992. He works within a well-resourced and experienced team which includes highly regarded income investors such as Alex Crooke and Ben Lofthouse.

David Smith is deputy manager of the trust. Smith has managed the Henderson High Income Trust since 2013 and the UK part of Bankers Investment Trust since 2017 and has worked with Curtis for a number of years.

Process

The trust invests in good quality, well-managed companies, which can be bought at a reasonable share price and contribute to the trust’s dividend. Curtis believes companies with sustainable and rising dividends will see their share prices grow over time. He likes larger, more stable companies which often have multinational operations that are robust enough to weather economic storms and still pay dividends. This provides UK investors with exposure to global growth through the these companies’ overseas revenues.

Curtis mainly invests in UK companies, although he can invest up to 20% overseas when he finds good opportunities. As of June 2025 (the end of the trust’s financial year), 8% of the trust was invested in companies listed overseas, down from 10% a year earlier.

Curtis reduced the amount invested overseas in favour of UK listed companies over the year on the basis that UK shares continue to provide better value than their overseas equivalents. Three new investments included insurance business Admiral, inter dealer broker TP ICAP, and oil and gas exploration company Harbour Energy.

The trust can borrow money to invest with the intention of increasing returns (known as gearing), but this could magnify losses in a falling market and increases risk. The manager can also use derivatives, which if used adds risk. The level of gearing as of the end of June was 5.3%, lower than the 7.1% level a year earlier. In addition, there may be some investments in smaller companies which, by their nature, can be higher risk and illiquid investments.

Culture

Janus Henderson is a large investment firm with offices all over the world. It was formed in 2017 from the merger of two long-established groups – US-based Janus Capital Group and Henderson Global Investors.

It values experience and sharing knowledge and ideas between investment teams is an important part of the culture. Managers have the flexibility to tap into the wider group’s resources for ideas and insights but also have the freedom to do their own research and form their own views without having a ‘house view’ placed on them.

ESG Integration

Janus Henderson aims to be a responsible steward of investors’ money, and ESG is an important part of this. All fund managers have access to ESG scoring models and customised ESG research, but the firm believes ESG considerations should go beyond examining numbers. Company site visits, speaking to workers and questioning company management are just some of the ways fund managers are expected to actively assess a company’s ESG credentials.

Investment teams across Janus Henderson actively engage with the companies they invest in, and the firm’s longstanding Responsible Investment & Governance team provides centralised support on voting and engagement.

When it comes to voting, Janus Henderson has a Proxy Voting Committee, which is responsible for establishing the firm’s position on major voting issues and creating guidelines overseeing the voting process. The Committee is comprised of representatives from various business areas, including portfolio management, corporate governance, accounting, legal and compliance. The firm’s full proxy voting records are published annually, although no rationale is provided. There is more detail on voting and engagement, including case studies, in the firm’s annual ESG Company Engagement & Voting Review report and Responsibility report.

The trust is not run to a sustainable investment mandate.

Cost

The ongoing annual charge over the trust’s financial year to the end of June 2025 was 0.36%. Investors should refer to the latest annual reports and accounts, and Key Information Document for details of the risks and charging structure. If held in a SIPP or ISA, the HL platform fee of 0.45% per annum (capped at £200 per annum for a SIPP and £45 for an ISA) also applies. Our platform fee doesn’t apply if held in a Fund and Share Account or in a Junior ISA.

Part or all of the annual charge is taken from capital rather than income generated. This could result in a higher dividend yield but can limit capital growth.

Performance

The trust has performed well since Curtis became manager of the trust in 1991. It’s delivered returns of 1,814.46%*, compared with 1,396.95% for the FTSE All Share index. Past performance is not a guide to the future.

In the trust’s last financial year, the dividend paid to investors increased by 0.7p to 21.3p per share, a rise of 3.4% which was fully covered by its revenues. This extends the trust’s record as the investment company that’s increased its dividend each year for the longest period – now standing at 59 years. The current dividend yield is 4.23%. Past performance isn’t a guide to the future. Dividends and yields are variable and not guaranteed, nor are they a reliable indicator of future income.

The trust's net asset value (NAV) rose 16.8% with the share price rising by 21.8% for the trust’s financial year to June 2025. This compares with a return of 11.2% for the FTSE All Share index over the same period, and a 12.6% gain for the AIC UK Equity Income sector.

The biggest contributors to performance include bank Natwest, which benefitted from higher interest rates in the UK. The trust also benefitted from having less invested in AstraZeneca than the index as it was impacted by uncertainty related to medicine pricing in the US under Trump.

Key detractors from performance included not investing in Aero engine manufacturer Rolls Royce which performed strongly. The trust’s investment in US listed pharmaceutical company Merck, which was affected by the same factors as AstraZeneca, was also a headwind.

At the time of writing the trust trades at a premium of 0.66%, which compares to a 12 month average discount of 0.45%. All investments and any income they produce can fall as well as rise in value, so investors could get back less than they invest.