Investment trusts have a variety of factors that should, in theory, exacerbate their capacity for losses during tumultuous periods, such as their ability to use gearing or higher-conviction positions.
While this makes them ideal for patient, long-term investors willing to stomach short-term losses for the potential for long-term compounding, in a period characterised by geopolitical conflict, the end of a pandemic, bear markets and highly concentrated markets, losses can be grave.
However, it is certainly not impossible to find trusts that have delivered on their return potential, while also proving relatively resilient in a downturn.
Last week, we analysed the open-ended global equity funds that were in the top quartile for “recovery periods” or the number of months they took to recover from their biggest loss, while doubling investors’ money over the past five years.
Applying these same criteria to the 300-strong Association of Investment Companies (AIC) universe results in just nine names.
However, there are some caveats, most notably the top three names. DP Aircraft I Limited and Alternative Liquidity Limited are in the IT Leasing and IT Hedge funds sectors, which have just three and four constituents, respectively.
Owing to the small sample size, these are instead the funds with the lowest recovery period in their sector that have doubled investors’ money.
Meanwhile, JPMorgan Taiwan is more straightforward, with a 191.8% total return paired with just an 11-month recovery period. The caveat here is that the IA Unclassified sector is much more eclectic, composed of a variety of specialist trusts with little in common.
Its stablemate, the JPMorgan European Growth and Income trust, makes the short list closer to the bottom, with a half-decade total return of 102.8% and 13 months spent in recovery.
Golden Prospect Metals’ 32-month recovery period may look steep compared with the rest of the shortlist, but this was better than the IT commodities and natural resources peer group average of 38 months. Between 2021-2023, the trust was in the red each calendar year, falling anywhere from 14% to 20%. However, 2024 and 2025 were exceptional years for the trust, which surged 164.8% in 2025 alone, as speculative investors poured into precious metals.
See also: Are precious metals losing their shine for investors?
Despite the pullback in precious metals earlier this year as the conflict in Iran boiled over, the trust is still up 153.8% over the past five years. Baker Steel was appointed the new investment manager in July this year.
The Global Equity Income strategy Murray International Trust spent just eight months in recovery, making it the quickest to rally on this list.
Managed by Bruce Stout, Martin Connaghan and Samantha Fitzpatrick, the trust aims to deliver an above-average dividend yield, with the potential for dividend and capital growth to outpace inflation.
Equity income funds more broadly did well in this study. For example, in the UK, Ian Lance and Nick Purves’ Temple Bar Investment Trust took just 12 months to recover from their worst fall and nearly doubled the performance of the FTSE All Share overall.
The trust aims to provide income and capital to achieve a total return above the FTSE All-Share index, mostly from investing in FTSE 350 companies. That said, it can invest a portion of assets outside the UK, with about 26% of the portfolio currently invested in other countries.
Earlier this year, analysts at Kepler identified Temple Bar as one of the most underappreciated trusts on the market, owing to the UK’s reputation as a relatively low-growth, unexciting area.
In the Asia Pacific Equity Income sector, Richard Sennitt’s Schroder Oriental Income has posted a 109% sterling return over the past five years.
The £1bn trust is well regarded by analysts at Rayner Spencer Mills Research, who said: “The managers are supported by one of the largest specialist Asian equity research teams in the industry, with extensive local market expertise and company access.
“The emphasis on quality companies, valuation awareness and sustainable dividends has historically supported resilience during weaker market environments while still allowing investors to participate in the long-term growth opportunities available across Asia Pacific markets.”
Indeed, over the past five years, the fund took just 15 months to recover from its worst loss, according to FE fundinfo data.
Finally, CC Japan Income & Growth trust was the only purely Japanese trust to appear on the table, delivering 120.1% over the past half a decade, after spending 12 months in recovery.
