Lindsell Train Investment Trust, run by star fund manager Nick Train, reported a 3.6% slump in its net asset value in the six months to the end of September. The trust was hit by its heavy exposure to consumer giants including Unilever, Diageo, and Laurent Perrier, whose shares have tumbled. Train admitted the fund was stuck in a long period of under-performance and warned that there was little sign of respite for shareholders. Over the six months, the trust's valuation fell by 11.9% on the back of a slide in its funds under management from £18.6 billion to £16.4 billion. Asset manager Premier Miton also struggled, posting a 60% drop in its annual profits and cutting its dividend.
In a recent update, fund manager Nick Train addressed the reasons behind the three-year underperformance of Lindsell Train Investment Trust. While most of the trust's funds have been top-quartile performers over 10 years, every fund and investment trust managed by the firm has failed to beat its peers over the past three years. Train attributed this underperformance to a lack of exposure to oil and mining companies, as well as misplaced confidence in certain companies' earnings power and undervaluation. Despite the disappointing performance, Train remains confident in his investment approach and portfolio structure, believing that they will continue to deliver attractive returns in 2024 and beyond. The portfolio remains highly concentrated, with the top 10 holdings accounting for 86% of the total assets. Train's investment themes include accelerating technology change, increased global wealth leading to increased spending on luxury and premium products, and world-class businesses in the UK stock market.
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