Investment Trusts 2021 onwards ...

whatstheplan

When I look at the top performing investment trusts and review their 5 year performance, you'd be tempted to hit 'buy now' there and then.  However, when you review their past performance from 2016 to 2019 (pre covid) most of them see a more sedate increase in value, however the 5 year increase to date has undoubtedly been helped by covid i.e. greater value increase over the last year or so.

If we assume (dangerous to do I know) covid is going to transition during the remainder of 2021 from something we're firefighting against to something that is being acceptably managed, is it likely most investment trusts will once again settle into a more gradual value increase from 2021 onwards?  Or, especially for trusts that invest heavily in biotech and healthcare, could we see this accelerated growth continue?

Yes, I know no one actually knows or we'd all be millionaires, however I'd be interested in your views.

Steve182

There are investment trusts and there are investment trusts.

You cannot make a direct comparison between completely different investment trusts. Some of the trusts below I hold, and many are invested in completely different markets.

Scottish Mortgage
Ashoka India
Baillie Gifford Shin Nippon
Vinacapital Vietnam Opportunities
Baillie Gifford UK Growth Fund (Trust)
Lindsell Train Investment Trust
Pacific Horizon
Baillie Gifford US Growth Trust
Etc Etc

Eg If India takes off in 2021 then Ashoka may well outperform Scottish Mortgage. 

Apodemus

whatstheplan said:

Or, especially for trusts that invest heavily in biotech and healthcare, could we see this accelerated growth continue?

The shine seems to be currently off the biotech and healthcare sector, so it might be a matter of "will the accelerated growth return" rather than continue. Of course that begs the question of whether there is a value opportunity in that part of the IT sector at the moment. But as you say, "no one actually knows"!

Thrugelmir

Investment trust managers will continue to follow their styles irrespective of wider market conditions. Performance will therefore fluctuate markedly. Takes time for contrarian positions to come to fruition. 

Voyager2002

Remember that there are two sets of factors at play in the prices of investment trusts:

1. The behaviour of the markets where they are listed;

2. The performance of the underlying assets.

So, for example, Vina Capital invests in Vietnam, where the economy and hence the market value of the quoted assets that it holds have performed reasonably well. However, shares in this Trust are traded in London, where government subsidies and bond-buying have put enormous sums into the market while there is a widespread perception that Vietnam is a good long-term bet. As a result, the discount has narrowed to levels that are very different from the long-term average. In deciding whether to buy at current prices, you need to consider whether both of these factors are likely to continue with the present kind of performance.