July's 10 most-bought trusts

Money Observer Rated Fund Scottish Mortgage was the most-bought fund on Interactive Investor in July as the global equity stalwart continues an almost uninterrupted 18-month reign over the top spot.

The £3.5 billion trust - the largest of the UK-listed global growth trusts - is a consistent top performer.

Managed by Baillie Gifford's James Anderson and Tom Slater, it ranks among the top three in the Association of Investment Companies' (AIC's) global sector for total share price returns over one, three, five and 10 years to 31 July, returning close to 320% in the latter period.

It has been unseated as the most bought trust on Interactive Investor only once since January 2014; by Woodford Patient Capital during the latter's launch in April.

Old hands

The trust was joined by a number of other firm favourites in July, including fellow Money Observer Rated Funds Biotech Growth, which was the second most-bought trust last month, Finsbury Growth and Income (fourth) and Witan (sixth).

Woodford Patient Capital was the third most-bought trust in July. Launched on 21 April the trust set a new record for a UK-listed investment company IPO, launching with £800 million of assets under management despite its mandate to invest mainly in very small quoted and unquoted companies.

As a result of increased demand and a soaring share price premium to net asset value (NAV), the board of Woodford Patient Capital announced on 11 August that it will issue up to £80 million of new share capital at a premium to NAV.

BlackRock World Mining climbed one place from June to be the fifth most-bought trust in July. This is despite the trust continuing to haemorrhage assets as a result of weakening commodity prices. Over one year to 31 July it has lost 49% in share price terms and 46% of its NAV.

However the trust's particularly high 8.6% dividend continues to attract investors, helping to keep its share price discount to NAV at just 9.4% - less than half the average discount in the sector.

Money Observer Rated Fund City of London was the seventh most-bought fund in July, falling two places from fifth in June. The trust has delivered fairly middling performance over the past five years; however it is also favoured for its dividends, having increased its payout to shareholders every year for nearly 50 years.

European stars

Two European trusts took eighth and ninth place in July: Money Observer Rated Funds Jupiter European Opportunities and European Assets. Jupiter European Opportunities re-entered the top 10 in January after a two-month hiatus and hasn't budged since thanks to manager Alexander Darwall's consistently strong performance.

Over one, five and 10 years to 31 July Jupiter European Opportunities is the top-performing trust in the AIC's Europe sector, returning 313% in the latter period compared to an average of just 165% from its peers.

Smaller companies-focused European Assets is also a strong performer, returning 180% over five years and 131% over three years to 31 July, making it the best and second best performer in its sector over the respective periods.

Henderson Smaller Companies, also a Money Observer Rated Fund, was the 10th most-bought trust in July, having re-entered the top 10 in May after a 12-month absence. Managed by Neil Hermon, Henderson Smaller Companies suffered a poor 2014, shedding 0.5% over the year due to a wider sell-off in the UK smaller companies sector.

However, the trust has enjoyed a resurgence of confidence this year, with its share price up 22.3% in the seven months to 31 July, helping to narrow its share price discount to 10.1% from a 12-month low of 16.6%.

This article is for information and discussion purposes only and does not form a recommendation to invest or otherwise. The value of an investment may fall. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.