Nick Train has apologised for the poor performance of the Finsbury Growth & Income Trust.
At a seminar today (May 18), Train said the performance of the trust over the past 18 months had not met his expectations.
“I’m sorry for that", Train said. "I’m sorry for shareholders and for their representatives… all I can say is that I sincerely hope that performance is going to improve.”
He warned that when performance picks up, it would not be because of a change in investment approach or a change in any of the portfolio’s major positions.
The trust reported a 6.9 per cent return in 2021, compared with the AIC UK Equity Income sector which returned 17.8 per cent, according to FE Fundinfo.
Over the past 12 months it has lost 12.2 per cent, compared with its sector showing a 3.5 per cent return.
Finsbury currently has 20 holdings, with its highest exposure to Diageo with 12.7 per cent, Relx with 12.5 per cent and the London Stock Exchange Group with 10.1 per cent.
Finsbury Trust performance
At the seminar, Train outlined the four "investment tenets" of Finsbury's trust.
The first is portfolio concentration, the second low portfolio turnover, he said.
"Three, the portfolio is built around a handful of industrial or thematic ideas that have objectively historically generated large returns for investors," he said.
Fourth is to only invest in what we analyse to be outstanding, he added.
Train explained the reasoning behind the trusts' portfolio.
“Notwithstanding what is going on in the Nasdaq, we simply cannot believe that we will be able to meet our investment aspirations over the next five years unless we are invested to a weighty degree first of all in digital winning businesses, or at the very least successful digital transformation opportunities," Train said.
"And second," he added, "unless we're invested in companies that have unique luxury premium or aspirational brands."