Trust derailed by gearing

The £96m Finsbury Growth & Income investment trust has reported a 31.7% fall in net asset value per share in its preliminary results for the year ended September 30. The fall is substantially more than its benchmark, the FTSE All-Share, which fell 22.3% over the same period.

According to a statement from the trust’s chairman, performance was hindered by the trust being geared into a falling market. Holdings in regional brewers and financial companies also hit performance in the fund, which is managed by Nick Train at Lindsell Train.

At the end of November financials accounted for 24.1% of the portfolio.

Train apologised to shareholders for the performance and the loss in value but said he is maintaining the trust’s gearing at 13.3% because it will enhance the eventual recovery in values.