F&C Investment Trust (FCIT) Price: 974p

Gain to date: 4.42%

We suggested investors buy F&C (FCIT), one of the oldest collective investment trusts in the world, back in October 2022 on the grounds it was a ‘safe bet’.

Fast forward 18 months to the spring of 2024 and the trust founded in 1868 and managed by Columbia Threadneedle is still delivering consistent returns despite a difficult macroeconomic and geopolitical backdrop.

WHAT HAS HAPPENED SINCE WE SAID BUY?

The trust has largely been putting in a robust performance and living up to its strategy of delivering ‘long-term growth and capital income’ to investors, even if returns look a little prosaic against Magnificent Seven-driven global markets. 

In its latest set of results (8 March) for the year to 31 December 2023, the trust declared an 8.9% increase in the full-year dividend to 14.7p per ordinary share. This represented the 53rd consecutive rise in annual dividends.

The trust’s growth in dividends over the past decade, at 63.3%, is almost double that of UK inflation over the equivalent period.

In a recent ‘fireside chat’ with shareholders, F&C chair Beatrice Hollond said: ‘We are hoping to pay an increased dividend this year [which must go to our annual general meeting first] which is an 8.9% increase, which means over one, three, five and 10 years we have paid a real dividend increase. The F&C board wants to be able to sustain that overall.’

In addition, over a 10-year period it has delivered a total shareholder return of 203%, equivalent to 11.7% a year.

Net asset value per share, with debt at market value, rose from 932.1p to 1,022.1p and F&C’s share price rose from 904p to 962p in the year ended 31 December 2023.

WHAT SHOULD INVESTORS DO NOW?

Stick with F&C. The trust prides itself in the consistent performance of its managers. Since inception there have only been 11 managers, with just three since 1969. This continuity is reassuring in our view.

To ensure new and existing shareholders get value for money, F&C has lowered ongoing charges from 0.54% to 0.49%.

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