Trustnet Magazine 57 December 2019 | Page 38

In focus [ TRUST ] 38 / 39 Mark Barnett has been removed from the trust following a period of poor performance Edinburgh Investment Trust TRUSTNET Woodford, it does signal investment trust boards are starting to become more active and more willing to change managers if they aren’t happy with performance. This is one of the advantages of investment trusts, as opposed to funds, and we could see more action like this from trusts.” FACT BOX MANAGER: Mark Barnett (until Q1 2020) / LAUNCHED: 08/02/1952 / DISCOUNT/PREMIUM: -10.64% / OCF: 0.56% CROWN RATING PERFORMANCE OF TRUST VS SECTOR AND INDEX UNDER MANAGER Edinburgh Investment Trust (32.28%) IT UK Equity Income (34.52%) FTSE All Share (44.15%) 60% 50% 40% 30% 20% 10% 0% -10% Barnett would be removed. The plan is to replace him with Majedie Asset Management chief investment officer James de Uphaugh. Analysts at Winterflood said: “Given Edinburgh Investment Trust’s track record since 2016, the news of a change in manager should not have come as a surprise.” They added that it will become “a very different proposition” under Majedie. Edinburgh’s portfolio will become closely aligned with the sub- portfolio of the open-ended Majedie UK Equity fund, which is managed by de Uphaugh. This has made 190 per cent between inception on 31 December 2006 to the end of November 2019, compared with 103 per cent from the FTSE All Share. A key differentiator will be a new emphasis on ‘Responsible Capitalism’ – an approach that directly integrates N ews that Invesco’s Mark Barnett will be replaced as manager of the Edinburgh Investment Trust came as little surprise to analysts. Over the three years to the end of November, the £1.3bn trust made a loss of 0.37 per cent in total return terms, compared with gains of 20.54 per cent from its average IT UK Equity Income peer and 24 per cent from the FTSE All Share. Edinburgh’s board had been reviewing the trust for some time, blaming its lacklustre performance on stock-specific issues rather than broad market moves – which caused it to “question the effectiveness of the investment process”. In the trust’s interim results in mid- December, chairman Glen Suarez said he was “disappointed by another weak result” and announced that environmental, social and governance (ESG) considerations into the investment process, without the use of third-party overlays or screens. Ryan Hughes, head of active portfolios at AJ Bell, commented: “While the move is under very different circumstances to Neil Source: FE Analytics trustnet.com