Institutions own 50% of investment trust shares

By Mark McSherry

The Association of Investment Companies (AIC) has published a comprehensive report on the ownership of investment trust shares as at December 31, 2023.

The report shows that institutions owned 50% of investment trust shares by value, up 1% on 2022, or £89 billion of the holdings that were analysed.

Asset managers dominated the ranking of largest institutional investors in investment trusts, including BlackRock, Columbia Threadneedle, Vanguard, City of London Investment Management and Legal and General.

Wealth managers held 25%, down 1%, (£44 billion), private investors 23% (£41 billion) and adviser platforms 2% (£4 billion).

Wealth managers with the largest stakes in investment companies were Rathbones, Evelyn Partners, Investec, Brewin Dolphin and Quilter Cheviot.

Institutions are particularly significant shareholders of alternative asset investment companies, with a share of 70%.

Private investors have a larger stake in investment trusts that invest in equities, making up one-third (33%) of the shareholder base of these companies.

Wealth managers make up more of the shareholder base of equity investment companies (28%) than they do of alternative investment companies (20%).

The AIC’s analysis is based on shareholder data from Argus Vickers and covers £177 billion of shareholdings, representing 87% of the industry’s total market capitalisation excluding VCTs at the end of December 2023.

AIC CEO Richard Stone said: “This report is the most comprehensive analysis ever of investment company ownership.

“It reveals that our shareholder base is as diverse as investment companies themselves, from the largest institutions and wealth managers all the way through to financial advisers and private investors holding shares on platforms.

“This has always been the case, from the days when investment companies were invented in 1868 to provide the investor of moderate means with the same advantages as large, sophisticated investors.

“Investment companies are a UK success story, giving investors access to a wide range of global opportunities and channelling capital into the drivers of future economic growth, such as infrastructure and the transition to net zero.

“We will update this analysis regularly to follow trends in the industry’s shareholder base and draw out more insights from the data.”