Brewin Dolphin, the UK-listed private client wealth management firm, has moved above the £3 billion ($4.8 billion) level of assets held in investment trusts, up from £1.7 billion when the firm began a department dedicated to this area five years ago.
The Investment Trust Research department at Brewin Dolphin is led by John Newlands. The rise in asset size contrasts, the firm said, with a drop of 500 points over that five-year period to the blue-chip FTSE 100 Index of shares. Almost 12 per cent of Brewin Dolphin’s client assets are held in investment trusts.
With the onset of the Retail Distribution Review this highlights the increasing importance of investment trusts, according to Newlands, referring to the RDR programme of reforms that, among other features, stamps out the use of trail commissions by wealth advisors.
“Their competitive running costs, transparency, independent boards and annual general meetings - that all shareholders can attend and vote at - provide the sort of reassurance from which many clients draw comfort,” he added.
Recently, the Association of Investment Trusts, the trade group representing the UK’s investment trusts sector, urged trusts to be clearer in how and when they used debt gearing. Such leverage is a standard feature of many trusts and is used to enhance returns.