Merchants Investment Trust (LSE: MRCH) has been operating for 130 years, having been set up in the 1880s. Over that time it has rarely hit the headlines. Nonetheless, its low-key longevity has won it plenty of fans.
For the past four years the fund has been managed by Simon Gergel, a Cambridge graduate with 23 years' experience. He keeps costs low by trading selectively he tends to hold stocks for four years and is only drawn to trade when he feels a stock is undervalued. One example is BAE Systems, which has "been sold too much on the back of fears of drastic government spending cuts", Gergel tells The Mail on Sunday.
Indeed, Gergel generally sticks to large British firms with substantial oversees operations and a strong dividend policy. Recently he invested in recruitment company Hays. He believes it offers long-term potential in Britain and "the overseas operations have structural growth opportunities as the temporary recruitment model gains acceptance".
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Alongside its low-costs the total expense ratio is just 0.45% Merchants Trust provides consistent performance and a steady income. The fund has returned 27.3% over the past five years compared to the 12.1% sector index. The yield has risen for 28 consecutive years it is currently 5.99%. "For anyone wanting income that has a good chance of growing enough at least to match inflation," this trust is worth considering, says Richard Dyson in The Mail on Sunday. The trust is currently trading at a 6% discount to net asset value.
Contact: 020-7859 9000
table.ben-table table { border: 3px solid #2b1083;font: 0.928em/1.23em verdana, arial, sans-serif;}
th { background: #2b1083; padding: 10px 5px;color: white;font-weight: bold;text-align: center;border-left: 1px solid #a6a6c9;}th.first { border-left: 0; padding: 5px 2px;text-align: left;}
tr {background: #fff;}
tr.alt {background: #f6f5f9; }
td { padding: 5px 2px;text-align: center;border-left: 1px solid #a6a6c9;color: #000;vertical-align: center;}td.alt { background-color: #f6f5f9; }td.bold { font-weight: bold; }td.first { border-left: 0; text-align: left;}
Merchants Investment Trust top ten holdings
| Royal Dutch Shell B | 8.1 |
| GlaxoSmithKline | 7.7 |
| Vodafone Group | 6.6 |
| HSBC Holdings | 6.6 |
| BP | 5.1 |
| AstraZeneca | 4.1 |
| Scottish & Southern Energy | 3.9 |
| British American Tobacco | 3.7 |
| BAE Systems | 3.5 |
| National Grid | 3.2 |
-
Divorce financial settlement fights surge – why it pays to agree terms earlyLawyers expect more court battles as tax rises and sharp falls in asset values make divorcing financially more difficult.
-
Emotional investing: what is it and how you can avoid itAre you an emotional investor? Your feelings could be damaging your long-term investments, but here's how to stay rational when the markets are turbulent.
