Hey All, I though I would share my Investment trust portfolio, along with the reasoning behind it.
Just to expand on Sarenco's point about Tax first. Both my father and I use Investment Trusts but our tax situation is very different. As a result our portfolios are also completely different.
I am in the highest rate tax band. As a result I am trying to avoid dividends. My investments are for the long term, 10-30 years, so I also want to avoid the 7 year exit tax and also want to avoid higher 41% exit tax rate vs the 33% CGT.
So for me, I want Investment Trusts with low dividend yields and low fees. I want to be globally diversified and have exposure to small and mid-cap stocks. Ideally I want a mix between growth and value (but as you'll see below my portfolio is a little light on Value because I'm trying to avoid dividends). I only choose funds that have a Bronze (or better) rating from Morningstar. My Portfolio is as follows.
| Fund | Ticker | Rating | Allocation | Yield | Fee | Style | Strategy |
| Berkshire Hathaway | BRK.B | | 25% | 0.00% | | Lg Blend | US |
| F&C Investment Trust | FCIT | Silver 5 | 20% | 1.59% | 0.56% | LG Growth | Global (CORE) |
| Scottish Mortgage Investment Trust plc | SMT | Gold 5 | 15% | 0.62% | 0.38% | LG Growth | Global Tech |
| Schroder Asian Total Return Inv. Company | ATR | Gold 5 | 10% | 1.78% | 0.87% | Lg Blend | Asia Pacific (ex Japan) |
| Jupiter European Opportunities Trust PLC | JEO | Gold 5 | 10% | 0.78% | 0.90% | LG Growth | Europe (CORE) |
| BMO Global Smaller Companies Plc | BGSC | Silver 4 | 5% | 1.13% | 0.60% | Sml Growth | Global Small |
| Finsbury Growth & Income Trust Plc | FGT | Gold 5 | 5% | 1.71% | 0.67% | Mix Growth | UK High Quality |
| JPMorgan Emerging Markets Inv Trust | JMG | Silver 5 | 5% | 1.35% | 1.02% | LG Growth | Emerging Mkts |
Note the Morningstar ratings etc. might have changed since I put the table together some time ago. I also have 5% for individual stocks. I don't consider Berkshire an individual stock, it is basically an investment fund in a stock wrapper.
My father is retired, married and in the lower tax bracket. He also has significant unrealized losses from BOI and AIB shares. If he uses ETF's he can't offset any gains against those losses. He wants an income stream from his portfolio. So he want High dividend yields, low fees, and that ability to offset previous losses. So again Investment trusts fit the Bill. His portfolio is
| Fund | Ticker | Rating | Allocation | Yield | Fee | Style | Strategy |
| Bankers Investment Trust Plc | BNKR | Silver 4 | 20% | 2.37% | 0.52% | Lg Growth | Global Blend |
| Murray International Trust Plc | MYI | Silver 2 | 15% | 5.55% | 0.61% | Lg Value | Intl Hi Div Yld |
| JPMorgan Global Growth & Income | JGGI | Bronze 4 | 15% | 4.28% | 0.57% | Lg Growth | World Dividend Growth |
| iShares Global Corporate Bond EUR Hedged | CRPH | 3 | 15% | 2.80% | 0.25% | BOND ETF | Diversified Corp Bond |
| iShares European Prpty Yld ETF EUR Dist | IPRP | Bronze 4 | 10% | 3.82% | 0.40% | Mid Blend | Euro Property REIT ETF |
| City of London Ord | CTY | Gold 4 | 9% | 5.46% | 0.39% | Lg Value | core UK equity income |
| Temple Bar Investment Trust Plc | TMPL | Silver 1 | 7% | 6.40% | 0.49% | Mix Value | UK Value |
| iShares Fallen Angels High Yield Corp Bond | WING | 4 | 5% | 4.50% | 0.50% | BOND ETF | High Yield Bond |
| Mercantile Investment Trust | MRC | Bronze 4 | 4% | 3.43% | 0.47% | Sm Growth | UK Midcap |
Again exact figures and ratings will be slightly off as the table was generated some time ago. Note that He does use ETF's for his Bond and Property REIT allocations - As the majority of the income from them are expected to come from Dividends and not price appreciation, the tax and loss harvesting issues are not a big concern, so ETF's fit the bill. Arguably his Bond allocation is too low and he is increasing it each year.
But the point I want to make here is that your tax situation will have a large impact on what your optimal portfolio will look like.
