The state pension is all very well, if you fancy living on just £23 a day. You should work hard to top it up, though, and the following investment trusts could help you do just that.
Going for growth
These three aim to deliver a combination of growth and income, to build your wealth while working and deliver income after you have stopped.
Perhaps the most exciting is JP Morgan Global Growth & Income (LSE: JPGI), the best performer on the Global Growth & Income sector measured over 10 years, up 257% in that time, and also over five years, when it returned 91%, according to Citywire. Past performance is no guarantee of future success, but management is clearly doing something right.
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Income for sale
This £425m global fund was launched in December 1964 and aims to outperform the MSCI All Country World Index over the long-term with a high conviction portfolio of typically 50-90 stocks, built through research-driven bottom-up stock picking.
The trust aims to pay dividends totalling at least 4% of its net asset value each quarter, and currently yields a generous 3.68%. It trades at a small premium of 0.95%, which is a sign of a fund in demand. Check its top holdings against your own portfolio for clashes: 4.6% of the fund is in Google-owner Alphabet, with other US stocks Microsoft, United Health Group, Pioneer Natural Resources, Union Pacific, Citigroup and Visa figuring strongly.
Global reach
My next tip is another global trust, Invesco Perpetual Select Trust Global Equity Income (LSE: IVPG). Again, it aims to deliver long-term income and capital growth through a globally diversified portfolio of stocks. Launched in 2006 this is a smaller fund with just £68m under management but is another top performer returning 187% over 10 years, and 72% over five.
This is around 35% invested in Europe and also the US, with 18% in the UK, and the remainder in Asia-Pacific and Japan. The top three holdings are Royal Dutch Shell, Chevron and BP, and with Total at number six you are getting plenty of oil exposure. Orange, Pfizer and Nasdaq also feature in the top 10. This offers an attractive yield of 3.25% and trades at a slight discount of -1.08,
Premium fund
Finally, the Scottish play. Although actually, Scottish American Investment Company (LSE: SCAM), managed by Baillie Gifford, is another global fund and this one comes with a truly long-term pedigree, having been launched way back in 1873. Founder William Menzies thought he could offer a better income than the “pitifully low” 3.5% offered by the Bank of England at the time. Now it pays just 3%, although of course these are strange times.
The trust is up 154% over 10 years, and 64% over five. It also has large exposure to Europe, around 36%, with a smaller US focus at 24%, and a spread of Asia-Pacific and international equities. Top holdings include Deutsche Boerse, Coca-Cola, Johnson & Johnson, Prudential, Hiscox and Microsoft. This is the largest trust of the three with £525m under management. It trades at a premium of 2.02.
Funds like these could even make you a millionaire. There is some crossover, so you may want to pick your favourite and match them with others. Then sit back and let the growth and income flow.
