Scottish Investment trust proposes merger with JPMorgan trust

Yesterday’s announcement that the board of the Scottish Investment Trust, the self-managed company that was established in 1887, proposes to merge with JPMorgan Global Growth & Income should act as a wake-up call for the wider industry, says interactive investor.

Kyle Caldwell, Collectives Specialist at interactive investor, the UK’s second largest DIY investment platform, says:

“The investment trust industry has faced criticism from various commentators and analysts over the years for having too many small, sub-standard trusts. It’s a fair charge, but one which should be levelled at funds, too.

“While investment trust boards are becoming increasingly proactive, whether by replacing an underperforming fund manager or fund management group, changing the trust’s strategy to broaden its appeal, or winding up the trust altogether – we see little evidence of this happening in the funds industry. So Scottish Investment Trust should be a wake-up call to the wider sector – if you can’t compete, it’s time for a fresh approach.

“When it comes to merging or winding up an investment trust, boards are voting themselves out of a job, which leads to potential reluctance. Interestingly, in the case of Scottish Investment Trust, it was announced that its board will keep their positions in the enlarged JP Morgan Global Growth & Income.”

Power of voting

Moira O’Neill, Head of Personal Finance, interactive investor, says: “Scottish Investment Trust might not have blown everyone away in performance terms, but it has been serving private shareholders for generations and many will be sad to see it go. But it is important to remember that its future is in shareholders’ hands – not all votes will inspire voters to turn out. But this is one that really counts.”

Voting on interactive investor

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