Investments  

Monks manager does not want to be a gearing ‘mug’

Monks manager does not want to be a gearing ‘mug’

The new manager of the Monks Investment Trust has said it suffered from not using its ability to gear while markets were going up.

In April, Charles Plowden took over as manager of the £864m trust, which is run by Baillie Gifford, after concerns about underperformance.

According to FE the trust, which was formed in 1929, has returned 36.8 per cent over three years compared to its sector – Global – which posted 40.4 per cent.

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Mr Plowden said: “Monks has suffered from not using its gearing over the past few years while markets were going up, but I don’t want to be the mug to use it when markets start to fall.

“The change of management was a very smooth switch and there was no change to the investment mandate – it was just a different team and we have a very clear and successful investment approach.

“Monks will be a distillation of the best ideas on the whole of the floor and none of our other investment trusts can say that – they are the result of very specialist teams.”

Mr Plowden has been with Baillie Gifford since 1983 and has been investment manager for the Global Alpha portfolios since 2005.

He acknowledged that the trust still has a discount of more than 12 per cent but said this would change soon.

Mr Plowden said: “We have still got a share price that doesn’t reflect the change to a proven strategy and the stock market has not noticed the change.”