RIT Capital Partners (RCP), the £3bn Rothschild-backed global investment trust, generated a 13.5% underlying return last year, helped by a strong second half recovery in world markets and excellent returns from its private equity investments, including a raised stake in SpaceX.

With sentiment towards the multi-asset fund improving following sustained share buybacks and increased transparency under chief executive Maggie Fanari, shareholders saw a 16.9% total return as the discount – or gap between the share price and the trust’s net asset value (NAV) – narrowed from nearly 30% in August to just over 22% by 31 December.

While this return did not quite beat the 17.1% from the MSCI All Country World index, it was well ahead of its official benchmark of achieving 3% more than UK inflation as measured by the consumer prices index, which offered a 6.4% hurdle.

The good performance reflected double-digit gains in all three main parts of the £4.5bn funds and shares portfolio.

Private investments, which had been the centre of investor concerns and one of the main factors in RCP’s share price de-rating in 2023, returned 18.3% and contributed 6.5% to the 13.5% rise in NAV.

Within this, direct investments in private companies, as opposed to private equity funds, made 47.4%, to represent 9.7% of net assets by the end of the year. The big driver of this gain was a doubling in the value of Elon Musk’s SpaceX to $800bn late last year, in which RCP first invested in November 2024 and increased its holding in a £42m deployment of capital in the second half of last year that saw it also take new positions in AI darlings Databricks and Anthropic.

As of 31 December, RCP had £102.3m invested in SpaceX, accounting for 2.5% of net assets and making it the trust’s biggest direct unquoted holding. Since the year-end SpaceX has risen to $1.25trn following its acquisition of sister company xAI, a deal that paves the way for a possible $1.5trn flotation this summer, according to reports. RCP is the only investment trust with a stake in SpaceX, outside of the Baillie Gifford stable of Scottish Mortgage (SMT), Edinburgh Worldwide (EWI), Baillie Gifford US Growth (USA) and Schiehallion (MNTN).

Databricks was a £16.9m investment at 0.4% of NAV at year-end with Anthropic a £7.4m position at 0.2% of the portfolio.

The sale of US low-cost share dealing platform WeBull at its flotation last April and partial exits from infrastructure company Scale AI and Xapo Bank also contributed to the direct unquoted investment return and ensured the trust continued to reduce its overall private equity exposure. This ended the year at 31.7% of NAV, down from 33.4%, 22% in third-party funds. This is now within the 25% to 33% target set by the board two years ago and down from a 40.7% peak at the end of 2022.

RCP also made 15% from quoted equities, where it increased its diversification from the US into funds investing in Japan, emerging markets and biotech.

Uncorrelated strategies rose 12.1% helped by good returns in absolute credit funds as well as the surging price of gold.

Currency hedging reduced the impact of the near 8% fall in the US dollar against the pound in response to President Trump’s chaotic tariffs policy to 2.9%.

RCP’s semi-annual dividends rose 10.3% to 43p per share last year. The board plans to increase the total by 4.7% to 45p this year, which would mark a 13^th consecutive rise in the pay-out.

RCP bought back £89m, or 3%, of its shares last year. This takes to £332m, or 11.2%, of total stock purchases in the past three years as the company has tried to narrow the discount – which reflects a lack of investor demand – and support shareholder returns that have badly lagged the portfolio’s underlying performance.

RCP’s figures show that in the past decade shareholders have only made a 62% return despite the trust making just over 119% from its investments.

Chair Philippe Costeletos said: “These results reflect the strength of our long-term investment strategy, disciplined risk management and the quality of our portfolio, and build on our track record of 10.6% annualised NAV per share total return since our inception.” RCP launched in 1988. It continues to believe that strong performance is the best way to narrow the discount that has widened to 26% this year.

Our view

James Carthew at QuotedData said: “RIT Cap’s results are pleasing, especially the surge in exits from its private investments and the impressive uplifts in value it has been achieving on these. However, the good news in the portfolio came from many different directions: hedging the dollar, exposure to gold and resurgent biotech stocks, and positions in sought after unquoted businesses like SpaceX and Anthropic, for example. As a shareholder, I would love to see this reflected in a narrower discount, but I am prepared to be patient.”

Stay a step ahead. Our daily newsletter brings you the latest on investment trusts and active ETFs. Subscribe here.