In the realm of investment trusts, Personal Assets stands out as a reliable refuge during turbulent market conditions. Its primary mission is to shield investors from the harsh impacts of declining stock markets while delivering steady, long-term gains.

This objective has been consistently met by its manager, Troy Asset Management, since they took over in March 2009. With average annual returns of 7%, Troy has demonstrated remarkable proficiency in fulfilling its investment promise.

Equally important is the fact that shareholders have enjoyed a relatively stable experience along the way.

When market indices dip, the trust’s share price tends to decline less dramatically. The trade-off for this defensive strategy is that returns may lag behind during periods of strong market performance.

Take, for instance, the global lockdown in 2020 due to Covid-19. The trust’s share price fell by 11.9% before rebounding, a far milder loss compared to the 35.3% slump experienced by the FTSE All-Share Index.

Recently valued at £1.7 billion, Personal Assets has once again demonstrated its robustness. Amid recent market fluctuations fueled by the Middle East conflict and Iran’s control over the Strait of Hormuz affecting oil supplies, the trust has held its ground.

Last month, the trust’s shares fell by 4 per cent compared to a 6.7 per cent drop in the FTSE All-Share Index.

So far this month, the shares are up 2 per cent, meaning the price is about back to where it was at the start of the year.

Not that Charlotte Yonge, the trust’s senior investment manager, is content. ‘March’s performance numbers were disappointing,’ she says, attributing them in large part to the fall in the gold price.

The trust holds 10 per cent of its assets in gold, with the rest of the portfolio invested in a mix of equities, short-dated UK gilts, Japanese bonds and inflation-linked government bonds (both US and UK).

Although the trust trimmed its gold holdings earlier this year by a third, Yonge is still bullish about the precious metal’s long-term prospects on the back of strong demand from Asian economies, inflationary fears stoked by the Middle East conflict and a desire by many countries to reduce their dependency on the dollar.

‘At the margin, some countries such as Turkey may be selling gold,’ says Yonge, ‘but this doesn’t undermine the case for gold exposure.’

Equities, spread across 18 holdings, account for a third of the fund’s assets. Defensiveness is the order of the day.

So, while Alphabet, parent company of Google, represents the trust’s third largest equity position, Yonge says it has been taking profits. 

‘We added to our position in Alphabet this time last year when the share price was around $145,’ she says.

‘It now stands just short of $340. If we had not chipped away at the holding, it would now account for 6 per cent of the portfolio.’

Like many market experts, Yonge questions the sustainability of the artificial intelligence investment theme of which Alphabet is a part.

She prefers instead companies such as drinks giant Heineken whose stock market valuation stands at a near 15-year low. ‘The stock has done little since we bought it in 2023,’ she says, ‘but it provides a margin of safety in a consumer sector that is defensive.’

The fund’s annual charges are 0.67 per cent and the shares stand at a small premium to the value of the assets – in part, a reflection of the trust’s appeal to investors seeking safer havens.

The market ticker is PNL and identification code BM8B5H0. Although it pays quarterly dividends, it is only equivalent to an annual yield of 1 per cent.

DIY INVESTING PLATFORMS

AJ Bell

AJ Bell

Easy investing and ready-made portfolios

Hargreaves Lansdown

Hargreaves Lansdown

Free fund dealing and investment ideas

interactive investor

interactive investor

Flat-fee investing from £4.99 per month

Freetrade

Freetrade

Investing Isa now free on basic plan

Trading 212

Trading 212

Free share dealing and no account fee

Affiliate links: If you take out a product This is Money may earn a commission. These deals are chosen by our editorial team, as we think they are worth highlighting. This does not affect our editorial independence.

Compare the best investing account for you