TRUST WATCH

New Star Investment Trust

WHAT DOES IT DO?

RATHER than investing in individual assets such as shares, the New Star Investment Trust puts savers’ money into carefully selected funds.

Instead of giving shareholders a steady income, the trust aims to grow their money over the long term.

WHAT DOES THE MANAGER INVEST IN?

The biggest holdings in the £75m trust are the Crux European Special Situations, Polar Capital Global Technology, Schroder Income and Fundsmith Equity funds. It aims to spread savers’ money across all sorts of assets, including shares, bonds, commodities and property, and can invest in anything from normal exchangetraded funds to hedge funds.

WHAT DO THE EXPERTS SAY?

Russ Mould, investment director at AJ Bell, notes that New Star is currently trading at around a 30pc discount to the value of its underlying assets.

He adds: ‘One good way to protect any portfolio on the downside is to try to buy assets when they are cheap.’

WHAT DO THE EXPERTS LIKE?

‘There is a spread of geographic and sector exposures, which may reassure anyone worried about what Brexit might mean for UKquoted stocks and the British economy,’ Mould says. Well-known money manager John Duffield, formerly of Jupiter and New Star Asset Management, is on the board and has his own money in the trust – he owns 59pc of the shares.

Edward Bonham Carter, Jupiter’s vice-chairman and brother of actress Helena Bonham Carter, also owns a sizeable stake.

ARE THERE ANY DOWNSIDES?

Although Duffield’s large stake in the fund does show his support, it could also be a downside as it makes the shares harder for savers to buy and sell.

Mould also notes that the yield – or how much New Star returns to its shareholders compared to the share price – is fairly low at 0.95pc, which barely covers the 0.87pc ongoing charge paid to the manager.