DIY Investor Magazine
/
December 2015
9
CITY OF LONDON
Adjusted for inflation, £100 in cash would be worth
£1662 today; with income reinvested, £100 put into
gilts would have handed back just under £7k; a broad
basket of UK equities would have earned you nearly
£27k; and £100 into the City of London would have
earned just over £56k. Whatever your investment, you
would have achieved the best outcome with a long
term approach. However, please consider that past
performance should not be used as a guide to future
performance.
LOW CHARGES
Charges can be a significant drag on performance,
a fact sometimes ignored by investors. For example,
using a simple mathematical model, a £10,000
investment growing at 6% for 30 years would be worth
around £51,000 in a fund charging 0.4%, but only
£42,500 in an identical fund charging 1%. Due to its
size and its ability to spread its costs among a large
base of investors, City of London’s ongoing charge is
the lowest in its sector, at just 0.43% per year.
SO WHY CONSIDER CITY OF LONDON?
•
While not a guide to the future, it has weathered a
myriad of economic events and market turmoil
through its conservative, blue-chip investments,
and presents a potentially good investment for the
long term.
•
It has the longest growing dividend record of any
investment trust, aiming to provide a smooth stream
of income to its investors.
•
It has the lowest ongoing charge of any investment
trust in its sector, reducing the drag to potential
future performance.
RISKS
Where the trust invests in assets which are
denominated in currencies other than the base
currency then currency exchange rate movements may
cause the value of investments to fall as well as rise.
The trust may use gearing as part of its investment
strategy. If the trust utilises its ability gear, the profits
and losses incurred by the trust can be greater than
those of a trust that does not use gearing.
If a fund is a specialist country-specific or geographic
regional fund, the investment carries greater risk than a
more internationally diversified portfolio.
Before investing in an investment trust referred to in
this document, you should satisfy yourself as to its
suitability and the risks involved, you may wish to
consult a financial adviser. The value of an investment
and the income from it can fall as well as rise and you
may not get back the amount originally invested.
Nothing in this document is intended to or should
be construed as advice. This document is not a
recommendation to sell or purchase any investment.
It does not form part of any contract for the sale or
purchase of any investment.
Issued in the UK by Henderson Global Investors. Henderson Global Investors is the name
under which Henderson Global Investors Limited (reg. no. 906355), Henderson Fund
Management Limited (reg. no. 2607112), Henderson Investment Funds Limited (reg. no.
2678531), Henderson Investment Management Limited (reg. no. 1795354), AlphaGen
Capital Limited (reg. no. 962757), Henderson Equity Partners Limited (reg. no.2606646),
Gartmore Investment Limited (reg. no. 1508030), (each incorporated and registered
in England and Wales with registered office at 201 Bishopsgate, London EC2M 3AE)
are authorised and regulated by the Financial Conduct Authority to provide investment
products and services.
