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I was fortunate enough to be invited to the offices of Troy Asset Management last Thursday to meet with the teams who manage two of our recommended investment trusts, the STS Global Income & Growth Trust, (Securities Trust of Scotland) and Personal Assets Trust. Troy was established in 2000 by the late Lord Weinstock and Sebastian Lyon to protect and increase, in that order, the value of shareholder’s funds.

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James Harries, who has been with Troy since 2016, took over the responsibility of STS in late 2020. The trust then absorbed the Troy Income & Growth trust in 2024 to deliver a more efficient investment solution to shareholders via increased scale and lower costs. Its focus is to provide a rising income alongside capital growth via a conservative investment style, investing in a concentrated portfolio of between 35 and 50 exceptional companies that can sustain growth at high returns of capital.

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As you know, our investment philosophy is to find a small selection of managers with differing styles and low correlations between each other. This provides us the diversification we are seeking for our clients as well as managing risk and importantly, volatility. Troy takes a very cautious approach to investment management, their mantra being, “We won’t make you rich, but we will keep you rich.”

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STS has underperformed the IA Global Equity Income sector since James took control, but this is partly because of their underweight in technology and AI, something we have sought as part of our diversification policy.  This has proved highly beneficial in the recent market sell off, led by technology stock, as STS has returned +14.39% over the last year compared to the sector return of +4.47% and the MSCI at +3.96%.

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Recent investments include Siemens, Amadeus and Nike whose share price, as James Harries explained to me, has sunk by 75% over the last few years largely due to poor management decisions. A new CEO has recently been appointed and this has encouraged James to buy into this iconic brand at a bargain basement price.

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I then met with Michael Kinsella who works within the multi-asset team that manage Personal Assets Trust. This is a much-loved trust founded in 1983 and managed by Ian Rushbrook, formerly of Ivory & Sime, until his death in 2008 when Sebastian Lyon took over.  Lord Weinstock’s desire to preserve what he had, rather than take risks to provide him with more, has influenced Sebastian’s style. He continues to follow Robin Angus’s lead, the previous Chairman of PAT, in providing excellent quarterly newsletters even if they seem to constantly predict Armageddon. He “sells fear”. But this is why the fund has held up so well as a sustainer of wealth.

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The fund has 57% in US and UK Treasuries, mainly inflation linked or short dated, 31% in global quality equities and 12% in Gold whose recent rapid rise has resulted in them taking some profits. It’s no secret that in the long-term equities have been a better generator of growth than fixed interest, but this fund is designed for those who want to sleep well at night. Since Sebastian took over, the fund has returned 7 % pa.  This equates to 195% over that time whilst the FTSE All share has returned +329% and the MSCI +617%.  It is a fund that definitely has a place within a balanced strategy.

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On a final unrealted point concerning the recent market volatility around Trump's governance, when everyone is thinking one thing then it’s probably the contrarian view that should be taken. As Max King states in this week’s Money Week, “It has taken less than a month for consensus opinion to shift from thinking that the US market is invincible to declaring that US exceptionalism is over.” And, John Maynard Keynes said, “My central principle of investment is to go contrary to general opinion on the grounds that, if everyone agreed about its merits, the investment is inevitably too dear and unattractive.”  

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All figures to 08/05/2025. FE Analytics, income reinvested and net of fund fees.

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Comments from James Scott-Hopkins as at 9/05/2025, Founder, EXE Capital Management

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The views are those of the author only. The above does not constitute a recommendation to buy the funds and advice should be sought from your financial advisor as to the appropriateness of these funds in your portfolio. The value of investments can fall as well as rise. Past performance is no guarantee of future returns.

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