Trust consolidation: The key questions investors need to ask

ITs

Following a recent spate of investment trust boards changing fund managers, Jackie Beard, director of closed- end fund research at Morningstar UK, considers the implications of these decisions for investors.

We have seen a handful of fund manager changes, or proposed changes, in the investment trust sector in recent months and this always gives pause for thought. There are some key reasons to encourage mergers, economies of scale being one compelling argument. A number of investment trusts are small in asset size and this places them below the radar of many investment professionals – another reason why a larger pot of money could bring benefits. Take the examples of Albany and Grampian investment trusts. These had assets of just £30m and £10m respectively prior to their merger with Troy...