- Investment trusts raised £575 million in the first six months of the year, up from £221 million a year earlier.
- Average discounts narrowed to 11.6 per cent, briefly dipping below 10 per cent for the first time since 2022.
- Technology-focused trusts led returns as fundraising gathered pace despite market uncertainty.
Britain's investment trust sector is showing signs of recovery after fundraising more than doubled in the first half of the year, suggesting investors are becoming more confident despite ongoing geopolitical and economic uncertainty.
Investment trusts raised £575 million through secondary fundraising in the six months to June, compared with £221 million during the same period last year. A further £742 million worth of shares was reissued from treasury, although the market did not see any new investment trust initial public offerings during the period.
The figures also point to improving investor sentiment, with fewer liquidations and narrower discounts across the sector.
Seraphim Space Investment Trust led fundraising with £137 million, followed by TwentyFour Income Fund at £98 million and Invesco Bond Income Plus with £85 million.
Corporate activity also remained strong. The sector completed three mergers, three acquisitions and six liquidations during the first half of the year. That compares with two mergers, four acquisitions and 11 liquidations over the same period last year.
Companies bought back £4.1 billion worth of shares, down from £4.77 billion a year earlier, while several investment trusts also returned capital to shareholders through tender offers.
Technology leads the gains
Investment trusts delivered an average return of 9.4 per cent over the six-month period, with technology and technology innovation funds recording the strongest performance.
Average discounts narrowed from 12.3 per cent at the beginning of the year to 11.6 per cent by the end of June. During May, discounts briefly fell below 10 per cent for the first time since 2022, reflecting improving market conditions.
Richard Stone, chief executive of the Association of Investment Companies (AIC), reportedly said fundraising had strengthened despite continued geopolitical and macroeconomic uncertainty. He added that the decline in liquidations and narrowing discounts suggested investor confidence across the sector was improving.
