Introduction
Investing for the first time can feel overwhelming, but investment trusts offer a simple, low-cost way to grow your money. Unlike picking individual stocks, trusts provide instant diversification, professional management, and steady returns—ideal for beginners.
In this comprehensive guide, we’ll cover:
✅ Why investment trusts are great for beginners
✅ 5 best investment trusts to start with in 2024
✅ How much to invest & where to buy
✅ Common mistakes to avoid
By the end, you’ll know exactly which trusts to pick and how to build a stress-free portfolio.
Why Investment Trusts Are Ideal for Beginners
Investment trusts are publicly traded funds that pool money to invest in stocks, bonds, property, and more. Here’s why they’re perfect for new investors:
✔ Diversification – Spread risk across multiple assets
✔ Professional Management – Experts handle stock-picking
✔ Dividend Income – Many pay regular payouts
✔ Liquidity – Easily buy/sell shares on stock exchanges
✔ Lower Costs – Often cheaper than mutual funds
5 Best Investment Trusts for Beginners (2024)
1. City of London Investment Trust (CTY)
- Focus: UK dividend stocks (BP, Unilever, HSBC)
- Dividend Yield: ~5%
- Why Invest? 57+ years of dividend growth—perfect for passive income.
- Risk Level: Low
2. Scottish Mortgage Investment Trust (SMT)
- Focus: Global growth stocks (Tesla, Moderna, ASML)
- Dividend Yield: ~0.5%
- Why Invest? Top-performing trust with high upside potential.
- Risk Level: Moderate
3. Greencoat UK Wind (UKW)
- Focus: Renewable energy (wind farms)
- Dividend Yield: ~5%
- Why Invest? Government-backed clean energy income.
- Risk Level: Low
4. F&C Investment Trust (FCIT)
- Focus: Global blue-chip stocks (Apple, Microsoft, Nestlé)
- Dividend Yield: ~1.5%
- Why Invest? 150+ years of stability—ideal for long-term growth.
- Risk Level: Low to Moderate
5. Tritax Big Box REIT (BBOX)
- Focus: UK logistics real estate (Amazon warehouses)
- Dividend Yield: ~4.5%
- Why Invest? E-commerce boom drives steady rental income.
- Risk Level: Moderate
How to Start Investing (Step-by-Step)
1. Choose a Brokerage Platform
Popular UK options:
- Hargreaves Lansdown (Best for research)
- Trading 212 (Commission-free)
- AJ Bell (Low-cost ISA option)
2. Decide How Much to Invest
- Start with £100-£500
- Consider monthly contributions (e.g., £50-£200)
3. Pick 1-3 Trusts
A simple starter portfolio:
- 60% CTY (UK dividends)
- 30% SMT (Global growth)
- 10% UKW (Renewable income)
4. Hold Long-Term & Reinvest Dividends
- Don’t panic-sell during market dips
- Compounding works best over 5+ years
- “Best investment trusts for beginners 2024”
- “Where to invest £1,000 as a beginner”
- “Safe dividend trusts for passive income”
- “How to start investing in trusts UK”
- “Top-performing investment trusts for new investors”
Common Mistakes to Avoid
❌ Putting All Money in One Trust
→ Solution: Diversify across 2-3 trusts (e.g., growth + income).
❌ Chasing Past Performance
→ Solution: Focus on low-cost, established trusts.
❌ Ignoring Fees
→ Solution: Check Ongoing Charges Figure (OCF)—keep under 1%.
❌ Checking Investments Too Often
→ Solution: Review quarterly—no need for daily monitoring.
Final Verdict: Start Simple, Stay Consistent
These 5 trusts offer the perfect mix of income, growth, and stability for beginners.
Action Steps:
- Open a brokerage account (e.g., Trading 212)
- Invest £100+ in 1-2 trusts (e.g., CTY + SMT)
- Add monthly if possible
- Hold for 5+ years for best results
