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Alliance Trust reports best Q1 in over 15 years


The £3bn Alliance Trust has reported its strongest first quarter in more than 15 years after global equities showed continued outperformance over the opening three months of the year.

The trust’s total shareholder return for the January to March period was 15.2 per cent, while the fund’s net asset value total return, with debt at fair value and inclusive of income, stood at 13.6 per cent.

This performance comes after the trust made a series of changes to its major holdings and implemented an increase in gearing.

Alliance Trust chief executive Katherine Garrett-Cox says: “This was our best first quarter performance in over 15 years.

“The continuing strong performance from global equities has fuelled this and, in local currency terms, the MSCI All Country World Index is up 8.6 per cent year to date, but 14.1 per cent in sterling terms.”

Over the quarter, the fund made a number of changes to its portfolio. Additions include Walt Disney, Zurich Insurance, Barclays and Infineon Technology, which account for £140m of the £220m of new holdings made over the period.

These purchases were funded by the disposal of stocks such as Lloyds, Ericsson, BG Group, ARM Holdings and Apache Corp, profit-taking in other holdings and an increase in gearing from 8 per cent to 12 per cent.

Furthermore, the trust’s total global equity exposure moved from 89 per cent to 96 per cent of NAV, while the weighting to fixed income went from 9.6 per cent to 8.5 per cent, mainly owing to the outperformance of equities over the three-month period.

In her outlook, Garrett-Cox adds: “We continue to monitor both the domestic and international economic backdrop and we do not anticipate the global economy slipping into recession.”


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