Investment group Lindsell Train suffers ‘painful’ slide in value

Lindsell Train admitted it has suffered ‘two years of disappointing performance’ as investors pulled their money out of its funds and markets slumped.

The investment group said its value fell by 10.4 per cent over the six months to September to £361.7million as funds under management dropped from £20.5billion to £18.6billion.

The company admitted the falls were ‘painful’. Co-founder Nick Train, 63, said he is having to ‘work harder than usual’ to remain optimistic as the war in Ukraine and the cost of living crunch batter his business.

Lindsell Train said its value fell by 10.4% over the six months to September to £361.7m as funds under management dropped from £20.5bn to £18.6bn

The performance was revealed in the half-year results of its oldest fund, the Lindsell Train Investment Trust (LTIT). Launched in 2000 and popular among British investors, LTIT owns 24.2 per cent of Lindsell Train. 

But this was one of the biggest drags on performance as LTIT made a loss for investors of £31.39 per share in the six months to September.

This was down from a positive return of £71.78 per share last year.

Julian Cazalet, LTIT’s chairman, said: ‘This fall is understandable when one considers the background uncertainties surrounding the conflict in Ukraine, rising inflation and rising interest rates.’

Investors pulled £1.5billion more than they invested out of Lindsell Train funds in the six months to September, and the money it looks after for savers slid another £400million due to falling markets. 

But as well as following the broader downturn in the market, he said that Lindsell Train’s funds have ‘suffered from more than two years of disappointing relative performance across all its four equity strategies’.

These strategies span four different areas, including the UK, USA, Japan and continental Europe.

This was due to the firm sticking to its guns and following its strategy of picking out companies which will produce high returns over a longer period, Cazalet said.

This leaves Lindsell Train vulnerable to short-term swings in the market, as its funds ‘tend to be populated with the same type of companies’.

Cazalet said he and his colleagues ‘strongly believe that this approach will outperform in the long term’.

Even so, Train – who manages LTIT – said the volatility was proving tricky. He said: ‘I admit that threading through today’s macro-economic and geopolitical thickets I must work harder than usual to maintain my native optimism.’

Train, who along with his wife owns 36 per cent of Lindsell Train, said he was optimistic about several of the companies held by LTIT.

He said: ‘We don’t own any companies where we don’t expect their future to be better than the past, however glorious.’

This post first appeared on Dailymail.co.uk