In our penultimate issue in the current weekly format the Shares team identifies some of the actively-managed funds and trusts they like the best from the thousands on offer to UK investors. We have not used any specific selection criteria to come up with our list, these are just our writers’ best ideas based on our assessment of the relevant vehicle’s track record, management and investment process. Read on to discover more. And, in next week’s final weekly edition of Shares, we will take our leave by sharing with you our very best stock ideas for the long term.
Our favourites
Blue Whale Growth (BD6PG78)
Price – 297p
I first invested in Blue Whale Growth (BD6PG78), a fund which prides itself on doing its own modeling to identify top quality growth companies, in the teeth of the Covid lockdown.
My many conversations with manager Stephen Yiu revealed a laser focus on identifying ‘quality growth’ companies which not only survive but thrive, generating sustainable free cash flow while expanding market share in growing industries.
Delivering superior returns remains Yiu’s first and foremost objective, and this is a fund which has repeatedly done so year after year, not just beating its Investment Association Global benchmark, but frequently smashing it.
Since 2018 (the fund’s first full year of performance data), it has averaged a 14.6% annualised return, or 5.9% delta outperformance versus the benchmark.
With a solid covering of global indices (S&P 500, Nasdaq, for example) in my portfolio, it makes me very comfortable backing a fund that is betting it can find better returns away from most of the ‘Magnificent Seven’, with AI chip firm Nvidia (NVDA:NASDAQ) its only pick from that group.
Blue Whale Growth is not a tech fund – it has previously deployed capital into oil sands in Canada and railroads in the US – merely one which sees many of the better investment opportunities in and around the tech sphere, a theme which has been in play since the internet emerged more than two decades ago.
Since then, we’ve seen rampant growth in ecommerce, automation, cloud computing and now, AI, setting the scene for that to continue.
So far, infrastructure technology specialists have stolen the AI show, providing crucial chip technology to lay the foundations for what many experts see as a brave new AI world ahead of us.
Blue Whale was ahead of the curve when it first invested in Nvidia nearly five years ago, and the fund continues to see the best opportunities in infrastructure, hence names like Broadcom (AVGO:NASDAQ), TSMC (TSM:NYSE), Lam Research (LRCX:NASDAQ) and Applied Materials (AMAT:NASDAQ) featuring prominently in the portfolio.
This month, the fund celebrated its eighth year since launch, and as mentioned earlier, the track record is better than good, having outstripped its IA Global benchmark every single year bar 2022.
Blue Whale Growth has done better than twice as well as its benchmark in each year since. Cumulative returns since launch are 195.6% versus 94.3%.
Past conversations with Yiu also reveal that, barring some property investments, his private portfolio is exclusively in the Blue Whale fund, so you could hardly ask for more in terms of aligning his interests with ordinary investors who choose to back the fund.
Annual charges are 1.07%, available for both the accumulation or income-bearing units, while there is an intention to bring charges down as scale increases.
That’s useful to know and I don’t see fees as unreasonable for the performance delivered to date and the potential for more superior returns down the line. [SF]
DISCLAIMER: Steven Frazer has a personal investment in Blue Whale Growth.
Fidelity Special Values (FSV)
Price – 377p
While I am a self-confessed income investor, with the majority of my holdings compounding dividends monthly or quarterly, there is one fund which stands out from the crowd for its ability to generate superior long-term NAV (net asset value) total returns while taking a contrarian approach.
As Sir John Templeton said, it’s impossible to produce a superior performance unless you do something different from the majority, and nowhere is that approach clearer than at investment trust Fidelity Special Values [FSV), which has beaten the market over one year, three years, five years and all the way back to its inception in 1994.
Current managers Alex Wright and Jonathan Winton haven’t achieved this track record just by picking unloved stocks, though – they have a clearly-defined process for selecting ideas, with a focus first and foremost on downside protection, and they stick to that process rigorously.
Companies are chosen based on fundamental factors rather than top-down ‘macro’ views, with a focus on those undergoing some kind of positive change which the market has yet to appreciate.
With the help of Fidelity’s enormous internal research resources, as well as access to company management, ideas are whittled down and those which pass muster are added to the portfolio.
In the first stage, the managers take an initial position in the stock with a view to increasing their holding as their conviction increases, and once the operational change takes effect and growth improves, it moves to stage two.
Stage two is where the wider market recognises change is happening and the shares re-rate, at which point the managers let the position run and increase in size.
Stage three is where the recovery is well under way and the share prices closes in on the managers’ upside target, meaning less upside potential and more downside risk, so the position is gradually reduced, and the proceeds are recycled into new stage one ideas.
In areas where stocks have performed well, like banks, the trust has reduced its exposure and recycled gains into consumer-facing businesses like retailers along with building materials companies and builders’ merchants.
Even though the UK stock market has beaten many of its peers year-to-date and the FTSE 100 has hit new highs, Alex Wright is still optimistic about the opportunities available.
‘Current market conditions continue to favour our contrarian-value investment style,’ says Wright. ‘The UK offers a rich pool of investment opportunities for diligent investors, combining strong earnings growth, high dividend yields and low valuations.’
He adds: ‘The combination of attractive valuations, particularly in small and mid-cap stocks, improving sentiment, and a broadening rally beyond large caps creates a compelling investment case.’ [IC]
TM SDL UK Buffettology Fund (BF0LDZ3)
Price – 135p
I believe interest rate cuts on both sides of the Atlantic could offer a big performance boon for the quality-focused TM SDL UK Buffettology Fund (BF0LDZ3), managed by straight-talking Keith Ashworth-Lord, an experienced practitioner of ‘Business Perspective Investing’ as championed by legendary investors Benjamin Graham, Warren Buffett and Charlie Munger.
This £300 million fund focuses on companies whose characteristics include easily understandable business models, fortress balance sheets, relatively predictable earnings and high returns on capital employed.
I like the fact Ashworth-Lord and his co-managers look for firms which are growing organically and run by experienced management teams who act with the ‘owner’s eye’, allocating shareholders’ capital in a rational way and not destroying value through high-risk acquisitions.
The fund avoids overly cyclical sectors such as oil and gas and mining, where earnings depend on commodity prices over which the companies themselves have no control, and also eschews banks on the basis Ashworth-Lord observes their returns are woeful once leverage is stripped out.
Having identified a truly outstanding company with a wide ‘moat’, patient investor Ashworth-Lord and his team wait until the shares can be bought at a price which is substantially less than their true economic worth. As Buffett puts it, ‘Price is what you pay, value is what you get’.
Since its March 2011 launch, TM SDL UK Buffettology is ranked first quartile in the IA UK All Companies sector, although the higher-rate environment and heightened market uncertainty of recent periods has left the fund lagging peers as a fourth quartile performer over one, three and five years.
Nevertheless, I believe this unconstrained, concentrated fund – with just 25 holdings at last count – can bounce back as the market re-rates the array of quality, cash generative compounders that make up the portfolio.
Top 10 holdings as of the end of August 2025 included fantasy miniatures maker Games Workshop (GAW), business information and data analytics star turn RELX (REL) and another AI and data winner in London Stock Exchange Group (LSEG), not to mention best-in-class retailer Next (NXT), North American pest control powerhouse Rollins (ROL:NYSE) and a stake in Warren Buffett’s Omaha-based investment vehicle Berkshire Hathaway (BRK.B:NYSE).
Outside the top 10, the fund offers investors exposure to Johnnie-Walker, Smirnoff and Guinness maker Diageo (DGE), where Ashworth-Lord believes we may have passed ‘peak pessimism’, as well as promotional products supplier 4imprint (FOUR), a market leader with a ‘cast iron balance sheet’ which Ashworth-Lord believes should emerge from any downturn in an even stronger position versus its weaker competitors. [JC]
Scottish American Investment Trust (SAIN)
Price – 505p
Sticky inflation and stalling economic growth pose a double threat to investors looking for reliable income and growth above the level of inflation.
One fund which is laser-focused on these issues is the Baillie Gifford-managed Scottish American Investment Company (SAIN), or SAINTS as it is known. The trust has delivered unbroken annual dividend increases for over 50-years, through thick and thin.
Since Baillie Gifford took over the mandate in 2003, the dividend per share has grown at an annualised 5% compared with average CPI of 2%.
The trust aims to be a core investment for private investors seeking income and has an objective to grow the dividend at a faster rate than inflation by increasing capital and growing income.
The fund has a global equity focus but investments are also made in bonds, property and other asset types.
The high-quality investing style of the managers has been out of favour, partly due to high interest rates, while the fund’s performance has not been helped by an underweight towards US stocks.
Consequently, the trust trades at a 10% discount to net asset value, providing long-term investors with an attractive entry point.
We believe that as interest rates fall and growth stalls, quality companies with durable businesses will come back into favour, benefiting the portfolio.
Managers James Dow and Ross Mathison look to populate the portfolio with long-term compounders which have resilient dividends supported by surplus cash flow.
The starting point is always a company’s potential to deliver earnings and cash flow growth above inflation. Importantly, the managers believe share prices and dividends follow the trajectory of company earnings and cash flow over the long run.
The managers split the investment universe into four broad buckets which they describe as compounding machines, exceptional revenue opportunities, management acceleration, and long-cycle returns.
The first two buckets are characterised by companies with enduring competitive positions, strong balance sheets, pricing power, proven management and strong volume growth.
The latter two buckets comprise companies with margin potential accompanied by a catalyst for change, strategic development, a shift of asset allocation priorities and strong management teams.
Over 90% of the portfolio is invested in the compounders and exceptional revenue opportunities buckets. Top holdings include Microsoft (MSFT:NASDAQ), TSMC (TSM:NYSE), Apple (AAPL:NASDAQ) and Deutsche Borse (DB1:ETR).
The trust has an ongoing charge of 0.58% a year. [MG]
JP Morgan Global Growth & Income (JGGI)
Price – 563p
If there is one fund which looks extremely well set to deliver long-term growth and income in my opinion, it’s JP Morgan Global Growth & Income (JGGI).
This investment trust has an impressive track record returning 312% and 96.5% over 10 and five years as well as paying a consistent dividend to shareholders, four times a year, at a current yield above 4%.
Structure wise, JP Morgan Global Growth & Income makes full use of being a trust, funding its dividend from a combination of capital reserves and the income generated by its underlying holdings.
This gives it the flexibility to invest in stocks with greater potential for capital appreciation that may not be accessible to conventional equity income strategies, as these companies tend to offer low or no dividend yield.
The trust offers investors a portfolio of 50 to 90 stocks, which it expects to exhibit superior earnings quality and faster earnings growth, it is therefore not surprising that some ‘Magnificent Seven’ stocks make an appearance in its top 10.
Microsoft (MSFT:NASDAQ), Nvidia (NVDA:NASDAQ)Amazon (AMZN:NASDAQ), Meta Platforms (META:NASDAQ) and Apple (AAPL:NASDAQ) are all present and correct.
Other US stocks in the top 10 include media giant Walt Disney (WALT) and US healthcare giant Johnson & Johnson (JNJ:NYSE).
Having merged with rival Henderson High Income Trust in February this year, it now has total net assets of approximately £3.4 billion (as of 11 September 2025) and it has a track record of being known as a ‘consolidator vehicle’, having merged with the Scottish Investment Trust in 2022, JP Morgan Elect in December 2022 and JP Morgan Multi Asset Growth & Income in March 2024.
It is currently managed by Timothy Woodhouse (who is due to step down on 30 September), James Cook and Helge Skibeli who have created a resilient global ideas portfolio by using proprietary analysis from JP Morgan’s research team to identify companies that will produce the best total returns.
Since Woodhouse was appointed portfolio manager in September 2017, the trust has produced NAV (net asset value) total returns of 160% (12.9% per annum) versus a return of 132% for its benchmark the MSCI AC World (in sterling terms).The ongoing charges are kept to a minimum at 0.43% with no performance fee.
Looking ahead, two key areas where the trust’s managers continue to see attractive opportunities are high growth stocks, particularly those exposed to semiconductor production, and defensive sectors, where, in their view, valuations have not looked as attractive for more than 15 years.
Consequently, the portfolio is positioned to benefit from several major structural trends, such as the AI (artificial intelligence) revolution, cloud computing and the transition to renewable energy, as well as sectors such as healthcare and assisted living. [SG]
These articles are provided by Shares magazine which is published by AJ Bell Media, a part of AJ Bell. Shares is not written by AJ Bell.
Shares is provided for your general information and use and is not a personal recommendation to invest. It is not intended to be relied upon by you in making or not making any investment decisions. The investments referred to in these articles will not be suitable for all investors. If in doubt please seek appropriate independent financial advice.
Investors acting on the information in these articles do so at their own risk and AJ Bell Media and its staff do not accept liability for losses suffered by investors as a result of their investment decisions.
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