Global fund F&C (FCIT) underperformed its benchmark in 2025 as the weak dollar and some disappointments in Europe and the US hindered performance.
However, the world’s oldest investment trust raised the total 2025 dividend to 16.6p, an increase of 6.4%. That marked the 55th consecutive annual dividend rise from the trust as well as its 158th annual dividend payment for shareholders.
The FTSE 100-listed fund also proposed a 4-for-1 share split at the upcoming annual general meeting (AGM) in May that will increase the affordability and liquidity of its stock.
Trailing the benchmark
Managed by Columbia Threadneedle’s Paul Niven, F&C’s 11.6% net asset value (NAV) total return lagged the 14.2% gain from the FTSE All-World Index. And yet the share price total return of 14.6% beat the benchmark as the discount to NAV narrowed from 9.2% to 6.8%.
F&C’s private equity portfolio again produced respectable absolute returns last year, while the trust benefited from strong absolute returns from all components of its listed equity strategies last year.
Some of its US value holdings produced high levels of excess returns and the emerging markets allocation performed well.
Unfortunately, ‘disappointing relative returns from our European portfolio and those of some of our US components hampered our overall return relative to the benchmark index’, explained chair Beatrice Hollond.
‘This was despite the decision to hold underweight positions in most of the so-called “Magnificent Seven” stocks relative to the benchmark, which did add relative value over the year.’
Favourable environment
‘Overall, the investment portfolio’s significant weighting in US assets detracted due to the decline in the US Dollar against Sterling’, observed Winterflood, ‘while gearing (8% at year-end) added value over the year.’
Niven, head of multi-asset solutions at Columbia Threadneedle, said: ‘Stronger earnings foundations, more opportunities within global equity markets and a more even distribution of market leadership support a favourable environment for diversified global equity investors.’
First-time investors seeking a ‘one-stop shop’ fund should consider F&C.
The storied trust’s diversified portfolio provides exposure to most of the world’s stock markets, with exposure to just under 400 individual companies across the globe.
Investors should look past last year’s rare performance blip and focus on the trust’s formidably strong long-run record.
F&C has delivered a total shareholder return of 619.1% over the 20 years to the end of 2025. That’s equivalent to 10.4% per annum. Furthermore, NAV total returns are the strongest of any investment trust or fund peer over the five years to the end of 2025.
Read the press release here: https://www.fandc.com/
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