Barely a year ago, the investment-trust sector was booming. These funds had, on average, outperformed their benchmark indices, and often by large margins, in almost every sector of the market as well as overall for a number of years. The average discount to net asset value (NAV) at which shares traded had fallen to negligible levels, boosting shareholder returns.
This had enabled many trusts to issue additional shares and a steady stream of new trusts to be floated. Laggards were returning capital to shareholders, changing their managers, merging or being wound up.
Now it is very different. Many funds have performed terribly. The growth focus of many trusts, which previously boosted performance, turned into a liability last year.
Small and mid-caps
