This quarterly review of best and worst-performing investment trusts covers the 260 trusts in Morningstar Direct over the period. In the first quarter, the top performing trust made a total return of more than 16%, while the bottom performer lost 55%.
Three UK-listed investment trusts have returned double digits so far this year with Baillie Gifford China Growth BGCG topping the list with 16.17% total return in the first quarter of 2025. The China stock market comeback also meant Fidelity China Special FCSS returned 10.80% and JPMorgan China Growth & Income JCGI managed an 8.89% return.
Some investors have previously described China as “uninvestable” over the past few years. With a property sector in crisis, various government crackdowns, and a slow economic recovery after the pandemic, investors moved their money out and numerous “ex-China” funds were launched. However, recently, the market has shown signs of recovery. The Morningstar China Index grew 33% in sterling terms over 2024, then another 12% in the first three months of 2025.
Henk-Jan Rikkerink, global head of solutions and multi asset at Fidelity International, said that China has reasserted its tech capabilities this year, and made it clear that it intends to mitigate the impact of US tariffs by boosting consumer spending and domestic demand.
“Once again, China is pushing itself towards the front of investors’ minds. From an asset allocation perspective, we’re becoming more positive on China - given evidence of this rally being better supported by fundamentals, especially in the tech sector.”
Latin America, UK and Europe Trusts Outperformed
Also on the double-digit leader board is BlackRock Latin American BRLA with a 11.84% return. The BlackRock Investment Institute said that the impact of US tariffs against Mexico has been less severe than expected, and the country’s role as an intermediate trading partner between competing economic and geopolitical blocs is increasing.
Europe and UK are also categories that did well as market outperformance paid off for some investment trusts. JPMorgan European Growth & Income JEGI was the best performer among those in the Europe categories, rising 7.90% in the first quarter, while Gold-rated City of London CTY beat its peers in the UK categories, also growing by 7.90%.
Technology and AIM Trusts Among the Worst Performers in 2025
Meanwhile, 90 investment trusts have had a negative year so far, and many of the losses are bigger than the positive returns on the list of winners. Some 14 funds have had losses surpassing 10%, with one trust, British & American BAF, losing 55.82% in 2025.
British & American invests in other trusts and listed UK and US companies. It holds over 50% of its assets in Geron Corp GERN, a biopharmaceutical company which was up 67% in 2024 but has subsequently fallen 53% so far this year. The Biotech Growth Trust BIOG became the third worst performer, down 15.08%.
The second-worst performer was investor favorite Polar Capital Technology PCT, which has a Morningstar Medalist Rating of Gold and a portfolio worth £3.8 billion, down 16.36%. The trust is heavily exposed to the magnificent seven stocks, many of which have been hit by the recent US market correction driven by tariff anxiety and slowing economic growth in the US. The £1.5 billion Allianz Technology ATT has suffered a similar fate, down 13.27% as the fifth worst performer.
While trusts invested in UK large-cap stocks have had a solid year so far, the opposite picture is true for smaller companies. Aberforth Geared Value & Income AGVI sits in the UK small-cap equity category and was the fourth worst performer in Q1 with 13.67% in losses.
The UK’s alternative investment market (AIM) is still not out of its multi-year trough. The total number of companies in the AIM index fell to a two-decade low in January this year (680) while in comparison, the all-time high, reached in 2007, was 1,700. But, with reforms to listing rules, AIM investors are hopeful for its future.
Unicorn AIM VCT UAV is the seventh worst performer in the first quarter, down 13.01% this year. Its fund manager, Chris Hutchinson, said that there are opportunities for long-term growth within the AIM market, but against a challenging backdrop for fundraising.
The £164 million venture capital trust (VCT) is currently holding a funding round for new investors and expects to be oversubscribed as investors look to use the VCT wrapper for tax efficiency.
Unicorn AIM VCT’s Hutchinson said: “History suggests that high-quality companies with strong fundamentals can thrive, even in difficult conditions, and AIM has long served as a launchpad for such businesses. The resilience and innovation seen across our portfolio give us confidence that, even in turbulent times, AIM can continue to produce the success stories of the future.”
Methodology for UK Investment Trust Returns
There are two main ways of calculating investment trust performance. Firstly, as investment trusts are listed companies with real-time pricing, it’s easy to see the daily share price performance online. Another way is to look at the net asset value (NAV), which is the value of the trust’s underlying assets. Most trusts under Morningstar coverage trade at a “discount” to NAV.
For example, the top performer in NAV terms was Baillie Gifford China Growth, with a gain of 16%. In share price terms alone, the trust is up more than 30%, an even chunkier return for the theoretical investor who bought shares on January 2 and held them until March 31.
The return tables use total Morningstar Direct data for net asset value. Morningstar’s calculation of total return is determined each month by taking the change in monthly net asset value, reinvesting all income and capital-gains distributions during that month, and dividing by the starting NAV.
The author or authors do not own shares in any securities mentioned in this article. Find out about Morningstar's editorial policies.
