Bankers Investment Trust pursues consumer recovery theme

The Bankers Investment Trust (LSE:BNKR) is one of the most widely followed listed investment trusts on the London Stock Exchange at the moment, and with very good reason. BNKR pursues long term capital and income growth, aiming to beat the FTSE World Index. It also has the long-established target of an inflation-beating dividend.

The Bankers Investment Trust is currently managed by Janus Henderson. It has the flexibility to invest in any geographic region and any sector and has not set limits on individual country or sector exposure. Its investment manager follows a bottom-up, value-based investment approach, looking especially at companies that have scope to generate cash and dividends.

Long-term savings vehicle

Ultimately, BNKR is positioned as a long-term savings vehicle which has global equities exposure. It has established a phenomenally successful track record and brings the benefits of diversification across markets and sectors which it would be impossible for private investors to emulate otherwise. We rate it as one of the top investment trusts in London right now and we’re not alone in that view – the trust is currently trading at a slight premium.

BNKR’s share price for the last 20 years demonstrates how it has been able to add value for its investors. There have been some ups and downs in the last 12 months, as you would expect as the managers seek to cope with what has been a tremendously volatile markets environment. BNRK was trading as low as 97p back in November, although it is currently nudging the 120p mark.

BNKR is currently managed by Alex Crooke, who is Co-head of Equities for EMEA / Asia Pacific at Janus Henderson Investors. He has held this role since 2018. He has a track record in the investment industry stretching back over 30 years,, most of it at Henderson / Janus Henderson.

Bankers Investment Trust strategy

Crooke is paying close attention at the moment to the uneven recovery in the world due to the chequered roll out of vaccinations and continuing issues with the pandemic. He has recently reduced his exposure to technology stocks in favour of industrials. The trust has also been reducing some of its exposure in the financials sector but is still backing some names that could benefit from rising rates.

It is refreshing to see that BNRK is not still stuffed full of the usual suspects from the tech sector – it has Microsoft there as its largest holding (2.22%), but the consumer theme is strong, notably with big positions in the likes of Estee Lauder Cos, Visa, Mastercard and Home Depot.

The trust is also seeking to play the recovery theme as markets open up and we see more economic recovery into the second half. Crooke is still sceptical on Asia this year, anticipating proper roll out of vaccines in 2022. Mining and industrials are expected to perform well. Technology is deemed to be too expensive in most cases. Also notable is the 1.93% in CME Group.

As of the end of March the Bankers Investment Trust has approx £1.5bn in assets under management. It is rated as a Dividend Hero by the Association of Investment Companies: this is a status reserved only for those investment trusts which have increased their dividends for 20 years or more consecutively. BNKR has increased its dividends consecutively for 54 years!

This article was brought to you in partnership with The Armchair Trader.

About Graeme

Graeme is Head of Technology at the Armchair Trader. He has worked in online financial investment publishing since 2000 as a website developer, advertising operations manager, data scientist and all-round go-to guy for online technical solutions.