More income-themed investment trusts launched in 2011, says AIC

Considerably fewer investment trusts were launched in 2011, the majority of which had strong income themes, according to the Association of Investment Companies (AIC).

There was a 60% drop in the number of new launches this year compared to 2010, with only 6 investment companies collectively raising £691m.

In comparison, 15 were launched in 2010, raising £1.7 billion.

There was an increase in the number of investment companies which changed their investment focus, up to 11 from 5 in 2010.

Annabel Brodie-Smith, communications director at the AIC, says: “In a challenging global economic environment, and at a time when low interest rates and creeping inflation have presented some difficult hurdles for those looking to maximise their savings, it’s not surprising to see that income has been the dominant theme of 2011.“

“This was the case both when it comes to new issues, but was also reflected in much of the secondary market activity.

A third of 2011 launches were concentrated in the specialist sectors, while much of the secondary market issuance was in the infrastructure sector.

The AIC noted that a number of companies also opted to drop their performance fee arrangements in the current environment.

The Foreign & Colonial Investment Trust, Schroder UK Growth fund and the British Assets Trust all terminated these fees.

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