Can these top-performing investment trusts help you to achieve financial independence?

These top-performing investment trusts could offer stellar growth for long-term investors.

| More on:

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

When investing, your capital is at risk. The value of your investments can go down as well as up and you may get back less than you put in.

Read More

The content of this article is provided for information purposes only and is not intended to be, nor does it constitute, any form of personal advice. Investments in a currency other than sterling are exposed to currency exchange risk. Currency exchange rates are constantly changing, which may affect the value of the investment in sterling terms. You could lose money in sterling even if the stock price rises in the currency of origin. Stocks listed on overseas exchanges may be subject to additional dealing and exchange rate charges, and may have other tax implications, and may not provide the same, or any, regulatory protection as in the UK.

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More.

Buying shares in an investment trust is a quick and relatively inexpensive way to get diversified exposure to global stock markets — as a fund manager makes key investment decisions on behalf of investors, you won’t need to worry about finding time to research companies.

If you’re unsure of which investment trusts to consider, then you might want to start out by taking a look at these top-performing trusts.

Long-term growth

For investors looking for long-term growth, I reckon the Lindsell Train Investment Trust (LSE: LTI) is worth a closer look. Shares in the investment trust have delivered a total return of 241% over the past five years, allowing it to easily beat the Morningstar Global Investment Trust category performance of 130%.

Should you invest £1,000 in Allianz Technology Trust Plc right now?

When investing expert Mark Rogers has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets. And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Allianz Technology Trust Plc made the list?

See the 6 stocks

The Lindsell Train Investment Trust seeks to maximise long-term total return by investing in global equities and other Lindsell Train funds. But what’s unusual about this investment trust is that it also owns a significant minority stake in its investment manager, Lindsell Train Limited. This 24.3% stake in the investment management company co-founded by Michael Lindsell and Nick Train accounts for 37.9% of the value of its portfolio.

With such a large position in a single unquoted investment, investors in the trust are highly exposed to fluctuations in the valuation of that single company. And although its position in Lindsell Train Limited has no doubt played a big role in the fund’s recent outperformance, the opposite can also happen in the future.

Nevertheless, many investors seem confident that the fund will continue to deliver market-beating returns, as shares in the investment trust currently trade at a 25% premium to its net asset value of £680.03 per share.

Japan

The Baillie Gifford Japan Trust (LSE: BGFD) is a standout performer in the Japanese category, with a five-year return of 248%, compared to the average investment trust peer performance of 176%.

The fund has been managed by Sarah Whitley since 1991 and primarily focuses on medium-to-smaller-sized Japanese companies. Despite sluggish economic growth in that country, Whitley reckons there are still good opportunities for many stocks in her portfolio.

She likes to pick stocks with above average growth prospects and top holdings include Softbank (3.6%), Yaskawa Electric (2.9%), Misumi (2.8%), Start Today (2.8%) and Persol Holding (2.5%).

Sector focus

As technology disruption continues to impact the business landscape, the technology sector has proven to be a consistent market leader in recent years. With this in mind, the Allianz Technology Trust (LSE: ATT) is a solid pick for investors expecting further significant gains.

Over the past five years, the trust has delivered a cumulative performance of 217%, earning it a top-quartile ranking in the technology sector category. Many well-known tech brands dominate its portfolio, including Amazon (6.6%), Apple (6.2%) and Facebook (4.3%) — its top three positions. But the fund also holds big positions in lesser known names, such as cloud computing firm Workday (3.7%) and payments solutions company Square (3.2%).

And as expected, the US is by far its largest geographical exposure, representing just over 80% of total assets. This is followed by China (6.6%), France (3.0%) and South Korea (2.7%).

But there may be an even bigger investment opportunity that’s caught my eye:

Investing in AI: 3 Stocks with Huge Potential!

🤖 Are you fascinated by the potential of AI? 🤖

Imagine investing in cutting-edge technology just once, then watching as it evolves and grows, transforming industries and potentially even yielding substantial returns.

If the idea of being part of the AI revolution excites you, along with the prospect of significant potential gains on your initial investment…

Then you won't want to miss this special report inside Motley Fool Share Advisor – 'AI Front Runners: 3 Surprising Stocks Riding The AI Wave’!

And today, we're giving you exclusive access to ONE of these top AI stock picks, absolutely free!

Get your free AI stock pick

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice.

Jack Tang has no position in any shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

More on Investing Articles

Investing Articles

Here’s what £20,000 invested in IAG shares at the start of 2024 would be worth today

IAG shares smashed the FTSE 100 in 2024, and Harvey Jones is kicking himself for squandering this buying opportunity. But…

Read more »

Investing Articles

BP shares are forecast to return 30% in 2025 – and they’re filthy cheap with a P/E of 5.8!

Harvey Jones bought BP shares twice in the autumn and after a bumpy start he expects great things in the…

Read more »

Investing Articles

At a P/E ratio of 8, are shares in this FTSE 100 winner unbelievable value?

3i is a top-performing UK stock that trades at a P/E multiple of 8. Should value investors be snapping up…

Read more »

Investing Articles

Best British growth stocks to consider buying in 2025

We asked our freelance writers to reveal the top growth stocks they’d buy in 2025, which included two 'Fire' recommendations!

Read more »

Passive income text with pin graph chart on business table
Investing Articles

2 shares to consider for turning an empty ISA into a £31,301 a year passive income machine

Earning passive income doesn’t take huge amounts of cash to start with. Investing in great companies consistently over time can…

Read more »

Investing Articles

What £20,000 invested in BT shares at the start of 2024 is worth now…

BT shares enjoyed a solid 2024, Harvey Jones discovers, especially once the bumper dividend is taken into account. So should…

Read more »

Investing Articles

The Lloyds share price could hit 80p in 2025!

The Lloyds share price could push as high as 80p in 2025, according to one highly respected analyst. Dr James…

Read more »

many happy international football fans watching tv
Investing Articles

This FTSE 250 stock offers no passive income but looks 42% undervalued to me!

Our writer has found one stock that he thinks could take off in 2025, even though it doesn’t offer the…

Read more »