Three long-term growth stocks to profit from a world that’s getting wealthier
Professional investor Nick Train of the Finsbury Growth & Income Trust picks three long-term growth stocks

When I think about Finsbury Growth & Income Trust’s 2021, I think with chagrin and euphoria respectively about the shares of two of its biggest holdings. I also think about the mediocre showing of the shares of a third, middling-sized holding, where that lacklustre performance presented an opportunity to buy a lot more.
It strikes me that in expanding on this teasing introduction I can convey something of how we invest shareholders’ capital and the types of companies that we hope will do well for them.
The London Stock Exchange’s ambitious data deal
Our problem stock in 2021 was London Stock Exchange Group (LSE: LSEG), which we have held for the best part of 20 years. It has been a great investment. For instance, over the five years to the end of 2020, its shares more than trebled. However, disappointingly, in 2021 they fell by over 20%. This can be ascribed to some investors worrying that LSE has recently been too ambitious – last year it closed the biggest acquisition in its history, Refinitiv.
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
This deal makes LSE, on some measures, the world’s top provider of market data and analytics. It is a leap into the big league. We can understand why some have decided to wait and see whether LSE has bitten off more than it can chew. But we remain long-term supporters. The transaction is consistent with LSE’s clearly articulated and hugely successful strategy, and market data is the gold dust of the 21st century. So we not only held, but we also bought more.
Diageo: profiting from wealthier drinkers
The winner was another long-term holding – Diageo (LSE: DGE). As a career-long UK equity investor I am always so grateful that Diageo is a UK quoted company – it has been a reliable cornerstone for us forever. Diageo is evidently the best spirits company in the world and spirits are a highly profitable and growing sector.
It is a long-established trend that as the world gets wealthier people drink less alcohol. Is that bad news for Diageo? Not really, because, crucially, richer people drink more better-quality products. And this phenomenon is helpful for Diageo and helps explain why its shares rose by more than 40% in 2021.
By and large, over my career it has been right to be optimistic about the global economy and today is no different, with digital technology accelerating wealth creation. Owning Diageo’s shares is still a great way to participate in things getting steadily better.
Fever-Tree: creating cachet
We think the same is true, as a corollary, for the third holding – Fever-Tree (LSE: FEVR). Fever-Tree has brilliantly created a new beverage category that did not exist 15 years ago – premium mixers for the growing premium spirits industry. As such it is not really competing against mass-market brands. Customers love the taste and luxury cachet the Fever-Tree brand conveys. Its success is manifest in the UK.
Now the question is whether Fever-Tree can replicate that domestic success in the US and continental Europe. If it can, then there is little doubt its shares have enormous potential. Of course, by the time you know for sure, it will be too late. So, we must take a view. The early signs for Fever-Tree abroad, particularly in the US, look thrilling. Accordingly, we bought more in 2021 – both the shares and the product.
Nick Train is a highly recognised fund manager, currently the co-founder of Lindsell Train Limited and their chairman. He is the portfolio manager for UK equity portfolios and Nick has over 40 years experience in investment management. Nick’s other roles include 17 years at GT Management where he worked his way up to a Chief Investment Officer for Pan-Europe. Nick graduated from the University of Oxford with a degree in modern history. Nick contributes to MoneyWeek’s share tips.
-
Trust in US TIPS to beat inflation
In an inflationary market TIPS, the US Treasury Inflation-Protected Securities are most compelling says Cris Sholto Heaton.
By Cris Sholto Heaton Published
-
The jury's out on the AI summit at Bletchley Park
World governments gathered for an AI summit at Bletchley Park in November, but were they too focused on threats at the expense of economic benefits?
By Simon Wilson Published
-
Trust in US TIPS to beat inflation
In an inflationary market TIPS, the US Treasury Inflation-Protected Securities are most compelling says Cris Sholto Heaton.
By Cris Sholto Heaton Published
-
What is Vix – the fear index?
What is Vix? We explain how the fear index could guide your investment decisions.
By Dr Matthew Partridge Published
-
Time to invest in the next agricultural revolution
As the global demand for food increases, food producers are seeking to lower their carbon emissions. Technology will help meet both goals.
By Dr Matthew Partridge Published
-
Asia’s hidden gems: Three undervalued Asian stocks
Personal View Fidelity's Nitin Bajaj highlights three favourite Asian stocks.
By Nitin Bajaj Published
-
Uber's switch to profitability is an opportunity for investors
The ride-hailing platform has just reported its first operating profit and its future looks bright.
By Stephen Connolly Published
-
The bond bust bodes well for equities
Rising yields on government debt herald the end of the free-money era and good news for investors.
By Max King Published
-
Japan is back: Three Japanese stocks to ride the rebound
Personal View A professional investor tells MoneyWeek where he’d put his money. Nicholas Price highlights three favourites.
By Nicholas Price Published
-
Vietnam, Asia’s new tiger economy, is roaring. Investors take note.
Just two decades ago, Vietnam was one of the world’s poorest nations. Now it is a thriving regional hub with ample scope for further rapid development.
By Alex Rankine Last updated