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Investment ISAs /

Investment Trust ISAs

Invest up to £20,000 per individual for 2021/2022

Investment ISAs put your capital at risk & you may get back less than you originally invested.

Scottish Mortgage Investment Trust

from Baillie Gifford

Allows ISA Transfers
Regular Savings
  • Fund Choice: Scottish Mortgage Investment Trust is an actively managed by fund manager Baillie Gifford, investing in a high conviction global portfolio of companies with the aim of maximising its total return over the long term. Capital at risk.
  • Invest From: £25 pm

Lindsell Train Investment Trust Plc

from Lindsell Train

Allows ISA Transfers
Regular Savings
  • Fund Choice: This investment trust aims to maximise long-term total returns. Nick Train is a believer in legendary investor Warren Buffett's policy of buying good quality companies and holding onto them for a long time. Holdings include Paypal, Diageo & Nintendo. Capital at risk.
  • Invest From: £25 pm

Technology Trust PLC

from Allianz

Allows ISA Transfers
Regular Savings
  • Fund Choice: Award winning investment trust offers investors access to the fast moving world of technology. The fund invests in stocks worldwide that have the potential to become tomorrow’s Apple or Google. Capital at risk.
  • Invest From: £25 pm

US Growth Trust plc

from Baillie Gifford

Allows ISA Transfers
Regular Savings
  • Fund Choice: This investment trust aims to produce long-term capital growth by investing predominantly in businesses in the USA. Top holdings in the fund include Shopify, Amazon.com, Wayfair & Tesla. Capital at risk.
  • Invest From: £25 pm

Global Smaller Companies PLC

from BMO

Allows ISA Transfers
Regular Savings
  • Fund Choice: One of the largest specialist global smaller companies investment trusts. Invests in smaller companies worldwide with no sector or geographical limits. Capital at risk.
  • Invest From: £25 pm

China Special Situations PLC

from Fidelity

Allows ISA Transfers
Regular Savings
  • Fund Choice: This investment trust seeks to achieve long-term capital growth through investing in companies listed in China and Chinese companies listed elsewhere. The Company may also invest in listed companies with significant interests in China. Capital at risk.
  • Invest From: £25 pm

World Wide Healthcare PLC

from World Wide Healthcare

Allows ISA Transfers
Regular Savings
  • Fund Choice: This investment trust invests in the global healthcare sector and aims to achieve a high level of capital growth. The Trust invests in a diversified portfolio of shares in pharmaceutical & biotech companies & related securities in the healthcare sector. Capital at risk.
  • Invest From: £25 pm

Polar Capital Technology

from Polar Capital

Allows ISA Transfers
Regular Savings
  • Fund Choice: This investment trust provides investors with access to the potential of companies in the global technology sector. The fund Researches and identifies developing technology trends and investing in the companies best placed to exploit them. Capital at risk.
  • Invest From: £25 pm

World Mining Trust PLC

from BlackRock

Allows ISA Transfers
Regular Savings
  • Fund Choice: The investment policy is to provide a diversified investment in mining and metal securities worldwide. Capital at risk.
  • Invest From: £25 pm

Environmental Markets

from Impax

Allows ISA Transfers
Regular Savings
  • Fund Choice: Investment trust that invests predominantly in companies that provide, utilize, implement or advise upon technology-based systems, products or services in environmental markets, particularly those of alternative energy and energy efficiency, water treatment and pollution control, waste technology & resource management. Capital at risk.
  • Invest From: £25 pm

What is an Investment Trust ISA?

An Investment Trust ISA is a Stocks and Shares ISA account that invests your money in Investment Trusts.

Your assets in an Investment Trust ISA are therefore immune from the following taxes:

  • Capital Gains Tax (tax normally charged on the growth in the value of an Investment Trust)
  • Dividend Tax (tax on dividends that Investment Trusts pay)

What is an Investment Trust?

Investment Trusts are companies that invest in a portfolio of other companies within a specific sector or industry.

They are run by professional fund managers who invest in the best companies within their sector, based on their expertise in the industry.

As they are structured as publicly listed companies, you can buy shares of the company through a stock exchange and benefit from the money they make with their investments.

Here are a few examples of some areas and sectors that Investment Trusts invest in:

  • UK Smaller Companies
  • Global Emerging Markets
  • Global High Income
  • Europe
  • North America
  • Asia Pacific

How do Investment Trusts work?

1. As Investment Trusts are listed companies, you can purchase shares in an Investment Trust to hold in a trading account such as a Stocks and Shares ISA.

2. The fund managers don’t invest your money individually – they pool it together with thousands of other investor’s savings to create a large pot of funds to invest with.

3. The fund managers then invest this money in other companies that they believe have the potential to grow and pay dividends.

4. As investment professionals, they consider the longevity and profitability of each company they choose with great consideration and attention to detail.

5. If these underlying companies perform well, then the share price of the Investment Trust will increase. They may also pay out fixed or variable dividends to investors.

6. If your Investment Trusts perform well, your Investment Trust ISA grows in value and you don’t need to worry about paying tax on any of the profits.

What are the best performing Investment Trust ISAs?

The best performing Investment Trust ISA is, unfortunately, impossible to predict.

Past performance is not a guaranteed indicator of future returns. Unfortunately, you can’t just look at the best performing Investment Trust over the last 5 years and think that it will produce exactly the same results.

Every Investment Trust is limited to the sector or region it invests in, and if that particular market performs well, they will likely reap the benefits.

However, if the market performs poorly, they will do their best to mitigate any losses by picking the most resilient companies and even holding more cash to reduce risk.

How do I pick the best Investment Trusts?

Although you can’t guarantee an Investment Trust will perform well, there are some factors you do have control over. Here are some of the key things to consider when comparing Investment Trusts:

  • Ongoing Charge – this is the fund manager’s charge that they will deduct from your investment. It may be worth paying more for a highly reputable Investment Trust, but it will also eat into your returns.
  • Performance Fee – details of any applicable performance fees are found in the Key Investor Information Documents. Some Investment Trusts charge more if they outperform their benchmark or meet certain performance goals.
  • Dividend Yield – this tells you the amount of dividends an Investment Trust has paid previously and indicates what might be paid in the future. You can also find out the frequency of upcoming dividends and usually the details of the next dividend to be paid.
  • The area or sector it invests in – pick a sector you think will perform well over the long term. It’s also a good idea to invest in multiple Investment Trusts to diversify your portfolio and spread your risk over various markets.

How do I open an Investment Trust ISA?

  1. Pick a Stocks and Shares ISA provider. You can open an account with them online, over the phone or by post.
  2. Add money to your account with a debit card or by setting up a direct debit.
  3. Choose your Investment Trust(s) to buy, and purchase them in your online ISA account

Oliver Roylance-Smith
Edited by Oliver Roylance-Smith - ISA.co.uk

Frequently Asked Questions

There is no limit to when and how much you can withdraw from an Investment Trust ISA. You just need to sell down your Investment Trusts first which can take a few days.

You can add up to £20,000 to an Investment Trust ISA in the current tax year, up until 5th April 2021.

Investment Trust ISAs can go down as well as up in value. Therefore, you could end up getting back less money than you originally invest.

You can transfer a Cash ISA or any other ISA into an Investment Trust ISA. You’ll need to complete a form with your new ISA provider to start the process.

ISA accounts can only be held by individuals, not couples.

Yes, most Stocks and Shares ISA providers allow you to hold as many Investment Trusts as you like, but they usually have a minimum investment amount of about £100.

You can have more than one Stocks and Shares ISA open at one time containing Investment Trusts. However, you can only contribute to one Stocks and Shares ISA per tax year. You can transfer ISAs together without it counting towards your ISA allowance.

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Important Risk Information:

The value of investments can go down in value as well as up, so you could get back less than you invest. It is therefore important that you understand the risks and commitments. This website aims to provide information to help you make your own informed decisions. It does not provide personal advice based on your circumstances. If you are unsure of how suitable an investment is for you, please seek personal advice.

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Latest News

5 Considerations for Your Next Investment ISA

15th March 2021

You've decided to invest your savings into a Stocks and Shares ISA. You'll be using your tax-free ISA allowance for this year before the deadline, while also investing your money for your future. But what do you need to consider before opening an account? We've put together a list of our top five considerations for you to think about before you click "apply". 

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