Top-performing investment company sectors in 2021

Growth Capital and UK Logistics lead the way.

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Growth Capital is the top-performing investment company sector in the year to 30 November, new data from the Association of Investment Companies (AIC) has revealed. The sector produced a return of 47% over the 11 months to November, compared to the average investment company return of 13% over the same period.

The Property – UK Logistics sector delivered the second-highest return of 43% while the Country Specialist and Environmental sectors placed third and fourth, delivering 31% and 29% returns respectively. The Country Specialist sector was buoyed by the strong performance of three investment companies that invest in Vietnam.

Top 10 investment company sectors from 1 January to 30 November 2021

Share price total return in % to
30 November 2021

Year to date

1
year

3 years

5 years

10
years

 

Overall weighted average exc. VCTs

13.41

20.03

49.78

81.67

261.59

1

Growth Capital

47.43

73.37

N/A

N/A

N/A

2

Property – UK Logistics

43.14

44.70

97.04

N/A

N/A

3

Country Specialist

31.33

40.83

67.20

130.83

387.03

4

Environmental

29.02

29.70

102.47

156.05

N/A

5

Private Equity

26.02

36.38

78.56

101.93

520.43

6

Property – UK Commercial

24.29

28.99

5.56

 9.52

80.41

7

Leasing

22.97

20.18

-56.69

-58.48

N/A

8

India

21.29

32.50

28.09

46.59

156.49

9

Debt – Structured Finance

19.97

22.22

14.81

32.08

N/A

10

Asia Pacific Smaller Companies

19.84

26.04

35.04

53.47

177.33

Source: AIC/Morningstar. Sector returns are weighted averages. N/A denotes where sectors had too few constituents to calculate a meaningful average.

Annabel Brodie-Smith, Communications Director at the Association of Investment Companies (AIC), said: “Despite the pandemic continuing to affect our lives, it’s positive to see the average investment company delivering a healthy 13% return. This year the best-performing sectors are dominated by alternative assets such as unquoted companies and property, as well as specialist equity.

“The best-performing sector, Growth Capital, is relatively new and invests in later stage venture capital. It has proved popular as higher growth companies stay private for longer. Whereas the UK Logistics sector has benefited from the surge in online shopping and the need for more warehouse space.

“It’s interesting to look back at the best-performing companies, but important to remember that past performance is not an indicator of future returns. Investing should be for the long term and investment companies cover a broad variety of sectors, risk profiles and geographical exposure to match a range of investor needs. Investors need to consider their investment objectives and focus on building a diversified long-term portfolio.”

Top-performing investment companies

The ten best-performing investment companies came from a variety of sectors. The Commodities & Natural Resources and Private Equity sectors featured most prominently, each contributing two of the top ten (see table below).

Geiger Counter was the best-performing investment company over the 11 months to 30 November. The company, from the Commodities & Natural Resources sector, produced an impressive 111% share price total return from 1 January to 30 November. It is followed by Schiehallion in the Growth Capital sector, up 109%, and VietNam Holding in the Country Specialist sector, up 74% over the same period.

Rob Crayfourd and Keith Watson, Managers of Geiger Counter, said: “Nuclear power is benefiting from a positive swing in sentiment in its direction. Both governments and investors are increasingly aware of the need for nuclear power, both as a non carbon-emitting energy source and to provide baseload power in support of the green energy agenda. Whilst renewables are an ever-increasing component of energy supply, production is intermittent in nature, making nuclear an essential part of the energy mix, especially in meeting emissions targets. We think that the current supply deficit is unsustainable and will drive a continued recovery in the uranium price, which will bring new projects into production, particularly as current market uncertainties are making it difficult for new projects to advance.

“We believe demand growth will be driven by a build-out of new reactors led by the emerging regions of China and India, which are focusing on improving air quality. The portfolio has a strong bias towards small and mid-cap uranium mining companies and this reflects our view that these types of company generally have superior growth prospects (for example, production improvements or improvements in reserves) and, generally being less well researched, it is also where the closed-end nature of the company allows us to take a longer term view.”

Craig Martin, Manager of VietNam Holding, said: “It has been a stand-out year for Vietnam and Vietnam Holding in many ways. Not only have we seen a very strong performance in our NAV and share price, but we have been able to do more, measure more and report more on our responsible investing initiatives.

“Domestic investors have driven the stock market to record highs on the back of surging levels of liquidity and, with our team on the ground, we have been able to nimbly navigate the opportunities, and position our concentrated portfolio at the junction of great growth and reasonable valuations. We are excited by the prospects for 2022 as Vietnam gets back to its multi-decade GDP growth trajectory of 6% to 7% per annum.”

Ten top-performing investment companies

Share price total return in % to 30 November 2021

 

Year to date

1
year

3 years

5
years

10
years

 

Overall weighted average ex. VCTs

 

13.41

20.03

49.78

81.67

261.59

1

Geiger Counter

Commodities & Natural Resources

111.19

234.29

154.35

229.58

14.71

2

Schiehallion

Growth Capital

108.54

117.84

N/A

N/A

N/A

3

VietNam Holding

Country Specialist

73.96

102.42

78.31

88.82

634.71

4

Riverstone Energy

Commodities & Natural Resources

60.61

70.36

-59.44

-63.39

N/A

5

Tufton Oceanic Assets

Leasing

57.10

57.10

56.03

N/A

N/A

6

NB Private Equity Partners

Private Equity

56.94

74.13

80.63

124.68

479.63

7

AEW UK REIT

Property – UK Commercial

54.42

59.98

52.87

74.38

N/A

8

BMO Private Equity Trust   

Private Equity

53.65

57.49

56.74

91.79

367.79

9

India Capital Growth

India

47.79

62.94

42.37

71.92

232.39

10

Tritax Big Box

Property – UK Logistics

46.37

48.58

98.81

123.49

N/A

Source: AIC/Morningstar. N/A denotes where companies were not in existence for the entire period. Ordinary share classes only. Companies undergoing acquisition, liquidation or restructuring are excluded.

 

-ENDS-

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Notes to editors

  1. The Association of Investment Companies (AIC) was founded in 1932 to represent the interests of the investment trust industry – the oldest form of collective investment. Today, the AIC represents a broad range of closed-ended investment companies, incorporating investment trusts and other closed-ended investment companies and VCTs. The AIC’s members believe that the industry is best served if it is united and speaks with one voice. The AIC’s mission statement is to help members add value for shareholders over the longer term. The AIC has 358 members and the industry has total assets of approximately £274 billion.
  2. Disclaimer: The information contained in this press release does not constitute investment advice or personal recommendation and it is not an invitation or inducement to engage in investment activity. You should seek independent financial and, if appropriate, legal advice as to the suitability of any investment decision. Past performance is not a guide to future performance. The value of investment company shares, and the income from them, can fall as well as rise. You may not get back the full amount invested and, in some cases, nothing at all.
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