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Investment trust research

F&C Investment Trust: April 2024 Update

Investment Analyst Aidan Moyle shares our analysis on the manager, process, culture, cost, and performance of the F&C Investment Trust.
F&C Investment Trust: March 2023 Update

Important information - This article isn’t personal advice. If you’re not sure whether an investment is right for you please seek advice. If you choose to invest the value of your investment will rise and fall, so you could get back less than you put in.

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  • Paul Niven uses a multi-manager approach to invest in both public and private companies around the globe

  • Investments in private companies have generally performed well however, hindered performance in 2023.

  • The trust’s impressive dividend record continued

How it fits in a portfolio

The F&C Investment Trust aims to grow income and capital over the longer term by investing in companies from around the globe. Developed markets like the US, Europe and Japan are the primary focus but it also invests in higher-risk emerging markets.

The manager also takes advantage of the trust’s closed-ended structure by investing in early-stage private companies. By nature, although the rewards can be attractive, these are higher risk since they can be harder to sell – meaning they are less liquid. Tapping into all corners of the market, the trust could add diversification to a portfolio focused on income or both income and growth.


Paul Niven joined what was then Foreign & Colonial (now Columbia Threadneedle) as a graduate in 1996. He initially analysed Asian companies but has spent much of his career focused on asset allocation (deciding how much to invest in different assets, such as company shares or bonds). He’s now lead manager of several funds and serves as Columbia Threadneedle’s Head of Multi-Asset Portfolio Management.

Niven is the 11th manager of F&C Investment Trust and has been at the helm since July 2014. He doesn’t do all the investing by himself though. The portfolio is divided into different segments, each with their own dedicated manager. The majority are run in-house by Columbia Threadneedle, but external managers are also used where he feels they can add value. Each manager has different strengths, styles and areas of focus which are blended together and monitored closely. This is known as a ‘multi-manager’ approach.


Niven is responsible for guiding the asset allocation and managing the level of risk the trust takes. His framework centres around four pillars: economy, policy, valuation and behavioural factors.

Key economic indicators such as inflation and economic growth rates are monitored for different regions, alongside the level of support from governments and central banks. Niven and his team then assess how expensive or cheap (a measure of value) each region is compared to its history and other similar markets. Finally, they assess how sentiment is changing towards each region.

The underlying portfolios are each managed by different managers, most of which are run in-house by Columbia Threadneedle which helps to keep costs down. Where Niven believes Columbia Threadneedle doesn’t have market leading capabilities and insights, such as the exposure to US growth companies, he uses external alternatives. This approach means the trust is well diversified and provides exposure to over 400 companies.

Historically the trust had a much larger amount invested in the UK, but it now accounts for around 9%. Around 60% is invested in North America, although that’s still marginally less than the global stock market average. The rest is a mix of Europe and Japan, and higher-risk emerging markets. Niven can also allocate to smaller companies which can add risk

At the end of the trust’s last financial year in December 2023, 11% of its assets were invested in private companies. This was marginally less than the amount the year before. These are companies that aren’t listed on the stock market, but Niven thinks they can provide good long-term growth potential.

Over the past financial year, the biggest changes to the portfolio were in the US part of the trust. Niven has generally been adding to value stocks in this region for some time however, it was slightly lower at the end of 2023 compared to 2022. T.Rowe Price, the manager of their US growth investments was sold and the money from that strategy has been allocated to JP Morgan who will use the proceeds to invest in US growth focused companies. The value exposure that was managed by Barrow Hanley decreased in the first half of the year to help fund a new allocation with Columbia Threadneedle’s US Value team. They will run complimentary US value portfolios.

Niven towards the end of the year also switched exposure from the Global Sustainable Opportunities strategy to a new Global Focus strategy, managed by Columbia Threadneedle Investments. These strategies have similar portfolio characteristics from a responsible investment perspective but the new strategy has more freedom with respect to its investment opportunities.

The manager uses gearing (borrowing to invest), which can magnify gains but also increase losses, so is a higher-risk approach. The level of gearing at the end of the firm’s last financial year in December 2023 was 9.9% of the trust’s assets. This was a marginal increase from last year were gearing stood at 7.3% He has the flexibility to use derivatives, which if used adds risk. Potential investors should refer to the latest annual reports and accounts for details of the risks and charging structure.


F&C Investment Trust is the oldest in existence, having been founded in 1868 as a way for everyday people to pool their resources to invest. Nowadays the trust is part of Columbia Threadneedle, previously BMO, a large multi-national financial services company headquartered in Canada. On 8 November 2021, Columbia Threadneedle Investments, which is part of Ameriprise Financial Inc. acquired BMO’s EMEA (Europe, Middle East, and Africa) asset management business. Columbia Threadneedle now manages the trust, and the board remains comfortable that little will change in light of these developments.

Along with the trust, Niven manages several other Columbia Threadneedle funds. These include multi-asset portfolios of varying risk levels and sustainable versions of them. We prefer managers to run as few funds as possible so they can dedicate more time and focus to each one, however Niven does have significant resources and a large team at his disposal.

ESG Integration

Columbia Threadneedle believes well-managed companies that look to the future are better positioned to navigate the risks and challenges inherent in business. In recent years the firm has developed several proprietary tools, including a company rating system that combines an assessment of how well a company manages its “financial stewardship” with a view of how well it manages its ESG risks. Both aspects are combined into a single, forward-looking rating from ‘one’ to ‘five’. Our meetings with Threadneedle fund managers suggest the ESG tools are relatively well-used by the investment teams, and managers are generally aligned with the view that an understanding of ESG factors is essential if you want to get a full view of a company’s risk/reward profile.

The firm’s Active Ownership team coordinates voting and engagement activity. Engagement generally focuses on the current and emerging ESG issues that the team thinks will have the greatest impact on long term investment returns, the economy, the environment, and society. The team also undertakes event-driven engagement in response to unscheduled or controversial events. All engagement is tracked in a company-wide database and accessible to all research analysts and portfolio managers.

Engagement progress and voting activity is reported to investors in a quarterly and an annual Stewardship report. The firm also writes frequent thought leadership and insight articles.


The ongoing annual charge over the trust’s last financial year to 31 December 2023 was 0.49%. This was lower than the year previously where the annual charge was 0.54%. 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 charge of 0.45% (capped at £200 for a SIPP and £45 for an ISA) per annum also applies.

The platform charge doesn’t apply if the trust is held in a Fund and Share Account. As investment trusts trade like shares, both a buy and sell instruction will be subject to the HL share dealing charges within any HL account.


Since July 2014 when Niven took the reins, the trust’s outperformed the AIC Global sector average. Over this period to the end of February 2023, its share price grew 211.24%* vs 159.34% for the AIC Global sector. Its Net Asset Value (NAV) rose 209.92% over this period. Remember past performance is not a guide to the future. All investments fall and rise in value so you may get back less than you invest.

Over the trust’s past financial year to the end of December 2023, its share price increased 8.11% vs 14.74% for the AIC Global sector average. The trust’s NAV also increased by 11.59%.

After a poor 2022 the listed side of the portfolio rebounded with some positive returns. The largest gain was seen in the European portfolios followed by North America and Japan. The emerging markets part of the portfolio was relatively flat.

The European portfolio benefited from a number of the trust’s companies performing well. UK manufacturing business Melrose Industries performed well after three years of annual losses. UK litigation finance company Burford also performed strongly. Elsewhere, Suisse bank UBS also performed well after acquiring Credit Suisse on attractive terms.

Out of the three US portfolios it was the growth portfolio which had the strongest returns, whilst the value portfolio lagged. The growth portfolio benefited from the excitement in AI and was a significant contributor to performance last year. The exposure to Nvidia, Meta and Uber was a major beneficiary of this trend.

The trust Japanese portfolio also saw some positives, the country has benefited from healthier wage growth, modest inflation, and long-awaited improvements in corporate governance. However, they did face headwinds with their overweight to healthcare companies and underweight banks.

The emerging markets portfolio was relatively flat over the year. Exposure to China was the largest headwind for the trust as investors were put off by a lacklustre recovery from Covid-19 and lack of meaningful policy support from the Chinese government. There were some positives through exposure to Indian companies with Healthcare company Torrent Pharmaceuticals and consumer company Nestle India helping performance. India remains one of the more exciting markets due to a long runway of growth prospects, however the strong performance of the region means Niven is being selective with his investments.

The trust’s investments in private companies was disappointing this year when compared to recent years. The overall private equity portfolio delivered a loss of 1.7%. The total dividend per share for the year to 31 December 2023 was 14.7p, which is an 8.9% increase on the previous 12-month period. This trust is an AIC ‘dividend hero’ having increased its dividend for the 53rd year in a row.

At the time of writing the trust trades on an 10.25% discount however, throughout 2023 the average discount was -2.76%. The trust currently yields 1.48% although remember yields are variable and aren’t a reliable indicator of future income.

Annual percentage growth

31/03/2019 To 31/03/2020

31/03/2020 To 31/03/2021

31/03/2021 To 31/03/2022

31/03/2022 To 31/03/2023

31/03/2023 To 31/03/2024

AIC Investment Trust - Global






F&C Investment Trust PLC






Past performance isn't a guide to future returns.
Source: *Lipper IM to 31/03/2024.
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Written by
Aidan Moyle
Aidan Moyle
Investment Analyst

Aidan joined the Fund Research team in 2022 and is responsible for analysing funds and investment trusts in the US and Global Sectors. He has a keen interest in macroeconomics and in particular US monetary policies and the impact it can have on clients' investments.

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Article history
Published: 13th May 2024