Wealth managers ditch investment trusts as retail investors buy in droves

Institutional ownership remains high

Wealth managers’ share of the investment trust sector has continued to decline in the past two years, while the number of investment trust shares held by retail investors has spiked by 42% in the past half decade during a crunch period for the sector.

Since 2022, the share of investment companies owned by wealth managers has fallen from 27% to 24%, with the decline particularly sharp in alternative investment companies, where it has seen a decline from 24% to 17%, according to a report from the Association of Investment Companies. CEO of the AIC Richard Stone blamed the "consolidation in the wealth management industry, along with a cost disclosure regime that has inflated the apparent costs of investment companies" for making investment trusts less appealing to wealth managers.  "The cost disclosure issues have been particularly ac...