Stock market listed fund Personal Assets Trust is an unusual investment vehicle in that its focus is on preserving the wealth of those who buy its shares.
Of course, increasing the value of shareholders’ investments is also key, but it is the long-term protection of investors’ real wealth that lies at the heart of the investment process which manager Troy Asset Management applies to the £1.7 billion trust.
The result is a fund which invests across a broad church of assets and markets – from gold through to equities and bonds – in a quest to deliver positive returns for shareholders.
Troy has been at the trust’s helm since early 2009, and it has certainly delivered on its promise.
In the 15 full calendar years and two incomplete years (2009 and 2025) that it has run the fund, it has generated positive returns more times than negative ones (14 versus three).
Over the past ten years it has generated total returns of 78.3 per cent – better than the average for its peer group (74.7 per cent) and in excess of inflation, as measured by the UK Retail Index, of 56.8 per cent. Over the past five years its numbers are not so strong, with respective returns of 26.9, 32.3 and 38.8 per cent.
Charlotte Yonge, the trust’s co-manager, describes Personal Assets as a ‘sleep at night portfolio’. She adds: ‘When markets fall sharply, our share price goes down less. We try to lean back from risk, rather than lean into it.’
Such an approach, she says, means the trust’s portfolio is in defensive mode when crises hit.
For example, in 2007 when the financial crisis sent stock markets tumbling, the trust’s share price fall from peak to trough was 14 per cent, compared with an equivalent 55 per cent correction in the US market (S&P 500).
This year the trust has gently increased its exposure to equities from 29 to 41 per cent.
It’s not because Yonge and fellow manager Sebastian Lyon feel more bullish about stock markets – far from it. It’s more to do with the fact that they have been able to buy shares in solid, resilient companies at good prices without ‘any touchpads to Silicon Valley’, the home of artificial intelligence (AI).
New positions have been taken in Swiss company Alcon, a manufacturer of contact lenses, and Hubbell Power Systems, a US maker of insulators for electrical grids.
Apart from equities, the trust has a 12 per cent stake in gold. This position has remained the same in percentage terms for the past two years, with the managers taking profits when the gold price has risen. The fund has almost half of its assets in bonds, most of which are inflation-linked and either short-dated or close to maturity.
This strategy, says Yonge, provides a ‘nice risk return’ without exposing the fund to a driving up of yields caused by bond vigilantes becoming increasingly concerned by excessive government spending in the US or the UK.
Yonge spent last week attending an investment conference in Arizona on whether the US is in a tech bubble. She believes the US market is ‘fragile’ and that the bubble will burst at some stage. Relating it back to the dotcom crash of March 2000, she doesn’t think we’re in ‘1999 territory’ yet.
The trust’s annual charges total 0.67 per cent and the shares trade in line with the value of the fund’s assets – a deliberate strategy designed to remove an ‘element of volatility’ from the journey of shareholders.
The fund’s market ticker is PNL and identification code BM8B5H0.
DIY INVESTING PLATFORMS
AJ Bell
AJ Bell
Easy investing and ready-made portfolios
Hargreaves Lansdown
Hargreaves Lansdown
Free fund dealing and investment ideas
interactive investor
interactive investor
Flat-fee investing from £4.99 per month
Freetrade
Freetrade
Investing Isa now free on basic plan
Trading 212
Trading 212
Free share dealing and no account fee
Affiliate links: If you take out a product This is Money may earn a commission. These deals are chosen by our editorial team, as we think they are worth highlighting. This does not affect our editorial independence.
