The co-manager of the Lindsell Train Investment Trust has said there are promising signs that investors are starting to look beyond the tech and Covid-19 ‘winners’ of the previous year.
In a monthly update to shareholders today (January 26), Nick Train highlighted four holdings whose share price rose significantly in December, including Diageo (which rose 6 per cent), Heineken (9 per cent), London Stock Exchange Group (7 per cent) and Mondelez (11 per cent).
These movements led to a 4.8 per cent NAV return for the trust in December, outperforming the MSCI World Index by 2.9 percentage points.
“There were several encouraging share prices for your company in December, after 12 months when too many of our longstanding holdings have been disappointing or lacklustre,” he said.
“The future for premium spirits, premium beer and chocolate seems bright to us and the long-term share price charts of Diageo, Heineken and Mondelez suggest that continued business growth could indeed drive their share prices higher."
Lindsell Train Investment Trust cumulative performance to December 31
One month | Year-to-date | One year | Three year | Five year | Since launch | |
NAV return | +4.8% | +3.8% | +3.8% | +60.2% | +156.2% | +1659.5% |
Trust price | +1.2% | -9.7% | -9.7% | +14.8% | +57.9% | +1694.7% |
MSCI World Index | +1.9% | +22.9% | +22.9% | +69.5% | +83.7% | +322.3% |
Source: Lindsell Train Limited, Bloomberg, Morningstar Direct
Train added he is not surprised investors are ‘rethinking’ their pessimism about the London Stock Exchange, which acquired Refinitiv nearly a year ago.
“As the first anniversary of the closing of the Refinitiv deal approaches there must be a chance that forthcoming updates will provide positive news about the merger,” he said, adding if the news is positive then the LSE’s share price could rally further, after a ‘dismal’ 2021.
Train’s comments came after a period of underperformance for the trust.
The trust’s total return for the six months to September 30 was 5.9 per cent, lagging behind the firm’s benchmark, the MSCI World index, which saw a 10.2 per cent rise.
The trust's share price total return was -11.1 per cent for the month of November, compared with the 1.3 per cent return of its benchmark.
In December, Train’s co-manager Michael Lindsell said the trust had suffered from a fall in Lindsell Train Limited's valuation, which accounts for 47 per cent of the trust’s net assets, as well as struggled against “a market led by technology and cyclical companies”.
sally.hickey@ft.com
