Personal Assets Trust: July 2026 Update

• We like the simple philosophy behind this trust, with the potential for long-term growth and a focus on preserving wealth in weaker markets

• Co-manager Sebastian Lyon is part-owner of Troy, the manager of this trust, so we think he's incentivised to perform

• Lyon and co-manager Charlotte Yonge also have a good team of analysts around them to provide support on this trust

How it fits in a portfolio

Rather than trying to shoot the lights out, Personal Assets Trust aims to grow investors' money steadily over the long run, while limiting losses when markets fall. It tries to experience fewer ups and downs than the broader global stock market or a portfolio that's mainly invested in shares.

As a result, it could form the foundation of a broad investment portfolio, bring some stability to a more adventurous portfolio, or provide some long-term growth potential to a more conservative portfolio.

Manager

Sebastian Lyon took over management of Personal Assets Trust in March 2009. He's managed the trust in line with the investment philosophy that has underpinned Troy Asset Management since its foundation in 2000. Lyon‘s also managed the Troy Trojan Fund since its launch in 2001 – this is an open-ended fund that is invested similarly to the Personal Assets Trust. However, even though the two are similar, they will perform differently at times.

Lyon was previously also Chief Investment Officer of Troy Asset Management, however he stepped back from this role in May 2026. This gives him more time to focus on investing, which we view positively.

Lyon is supported by co-manager Charlotte Yonge on the trust. Yonge carries out analysis across a range of assets and works closely with Lyon. She’s jointly responsible for making investment decisions for the trust.

Overall, we think the team at Troy is strong, capable and stable.

Process

Lyon and Yonge like to keep things simple, a quality we value. They aim to shelter investors' wealth just as much as grow it.

To do this, the trust is constructed around four 'pillars'.

The first contains large, established companies the managers think can grow sustainably over the long run, and endure tough economic conditions. They’ve tended to focus on companies based in developed markets, such as the UK and US. This includes some of the world's best-known companies with highly recognisable brands, such as Unilever and Visa. The managers have the freedom to invest in higher-risk smaller companies, although the trust hasn’t invested much in this area for several years.

The managers reduced the amount invested in shares a little over the year ending 30 April 2026, to 35.6%. The managers sold investments in American Express, LVMH and Moody’s during the year, while adding London Stock Exchange Group, Hubbell and Alcon.

The rest of the trust is made up of investments that could bring some stability during more difficult markets.

The second pillar is made of bonds. 29.7% of the trust was invested broadly equally between US index-linked bonds (US TIPS) and UK Index-Linked Gilts at the end of April. Previously this was mainly invested in US TIPS, but the managers chose to add to gilts over the course of the year on valuation grounds. These investments could shelter investors if inflation remains higher than long-term central bank targets.

The third pillar consists of gold-related investments, including physical gold, and accounted for 9.2% of the trust at the end of April, down from 10.8% at the same time last year. Gold can act as a safe haven during times of uncertainty, or perform well when inflation rises or if key global currencies weaken.

The final pillar is cash and short-dated government bonds, where 24.4% of the trust is held. This is more than the 22.9% invested here 12 months’ ago. Within this bucket the team continues to have investments in the Yen, the Japanese currency. The team thinks this might provide some additional shelter during a market wobble and it adds diversification.

While the trust contains a diverse range of investments, it’s concentrated. This approach means each investment can contribute significantly to overall returns, but it can increase risk. The manager has the flexibility to use derivatives and gearing (borrowing to invest) which, if used, adds risk.

Investors in the trust should be aware that closed-ended funds can trade at a discount or premium to the net asset value (NAV). Unlike many other trusts, the board look to limit the size of the discount or premium, which typically helps to keep the share price close to the NAV.

Culture

We like that Troy's fund managers are dedicated to the same investment philosophy established two decades ago. The group has always been clear about the way its range of funds are managed, and the managers don't stray into overly complicated areas of investment markets. Wealth preservation is key, and each manager adheres to that mantra.

Lyon is a part-owner of Troy Asset Management, so we believe he's incentivised to perform, and for his funds and the business to do well over the long term. Other senior members of the firm also own a part of the business, and we think this contributes to the stability and loyalty of the team.

While Troy is home to a small, close-knit team of investors, the group has recruited more junior members over the years to boost resource and ensure the funds are left in good hands as and when more senior members retire. Despite the team’s growth we think Troy has remained a very collegiate unit with all members able to have input.

ESG integration

Troy Asset Management has been formally incorporating environmental, social and governance analysis (ESG) into its investment processes for a number of years, and it came from a strong starting point. It’s always been focused on the sustainability of returns and the fund managers are long-term investors.

In recent years Troy’s investment team has formalised the way they incorporate ESG and the way they talk to investors about it. ESG is integrated using a materiality-based approach, meaning the managers focus on the issues they deem to be most material. They also have access to third party ESG research.

Engagement and voting are the responsibility of the investment team. All votes are discharged, and usually cast in favour of management proposals unless the team believes investors’ interests are better represented by abstaining or voting against management. Their preferred course of action is to have dialogue with management ahead of casting a vote against. The firm publishes a summary of its ‘significant’ votes in its annual ‘Engagement and Voting Disclosure’ report, along with rationales for voting both in favour and against proposals. They also produce a quarterly Responsible Investment report, which includes voting and engagement statistics and case studies.

We believe ESG risks are comprehensively considered for all investments held in this trust, and that the ESG-related processes are robust. That said, this isn’t an exclusions-based or responsible investing trust, which means it can invest in any sector.

Cost

The trust's ongoing charge for the year to 30 April 2026 was 0.67%. Investors should refer to the latest annual reports and accounts and Key Investor Information for details of the risks and charging structure.

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 Lyon took over management of the trust in 2009 to the end of July 2026 it’s grown 206.0%*. We think this is an attractive return for a more conservative trust, and is well ahead of the UK Consumer Prices index of inflation (CPI). Remember past performance isn't a guide to future returns and you could get back less than you invest.

The trust hasn't done as well as the broader UK stock market, as measured by the FTSE All Share Index, which the trust uses as its main comparator. We expect the trust to perform in this way though. Even with the market setback in 2020, global stock markets have risen strongly since Lyon took over the trust. Its more cautious approach means it's not been able to keep up with rapidly rising markets.

Avoiding large losses has been an important characteristic of the trust and it’s tended to come into its own during weaker markets. We saw this in early 2020 when global markets stumbled amid the coronavirus outbreak, as well as during the ‘Liberation Day’ market turmoil and more recently the onset of the US/Iran conflict.

Over the 12 months to 30 April 2026, the trust’s last full financial year, the trust’s share price rose 6.2%. The trust’s Net Asset Value (NAV) rose similarly, gaining 6.3%. This was a long way behind the 25.2% growth of the FTSE All Share index, but ahead of UK CPI growth of 2.8%.

Investments in Gold added most value to the trust with the price of the yellow metal rising significantly over the 12 months to the end of April. Shares were also positive, with Alphabet (parent company of Google) providing particularly large gains. Other positives included Hubbell, the US electrical products company and insurer Chubb. Some shares fell in value though, including drinks companies Diageo and Heineken.

At the time of writing, the trust yield’s 1.02% and is trading at a discount to NAV of 0.36%. Income isn’t guaranteed, and yields aren’t a reliable indicator of future income. This trust has a policy of buying and issuing its shares so their value doesn’t move significantly away from the value of the underlying assets. This means the premium or discount to NAV can be expected to be small over time.