Beyond the Echo Chamber: Taking the Investment Trust Story to a Wider Audience
I spent this morning at the London Stock Exchange’s Annual Investment Funds Conference – although, strictly speaking, I spent part of it in an overflow room because the main auditorium was full. That 'fullness' really struck a chord with me.
At a time when there is so much discussion about the future of UK capital markets, it was encouraging to see a packed gathering of fund managers, investment company directors, advisers, investors, policymakers and others engaged in the sector.
The central theme was an important one: how can we mobilise capital more effectively to support economic growth?
Discussions ranged from economic security and backing British innovation, to future technologies and infrastructure, smaller companies, regulatory reform and accessing deeper pools of institutional and retail capital.
Investment companies have a potentially important role in all of this.
Their closed-ended structure enables them to provide investors with exposure not only to conventional listed equities, but to areas such as infrastructure, private equity, private credit and other less liquid assets. At their best, investment trusts can connect individual investors with precisely the sort of long-term productive investment that policymakers increasingly want to encourage.
And they have been doing it for a very long time. The investment company sector has a history stretching back more than 150 years.
The room was full. But are we talking to the right room?
Walking around the conference, however, I was struck by a paradox. We had just spent a morning in rooms overflowing with people who understand investment companies, discussing how to attract more capital to the sector.
But how many people outside those rooms really understand what an investment trust is?
For all the expertise, enthusiasm and innovation within the investment company industry, I believe we still have work to do in explaining its relevance to a much broader audience.
Investment trusts can offer ordinary investors professionally managed exposure to an extraordinary range of assets, markets and investment strategies. They can provide diversification, access to specialist managers and, in some cases, exposure to assets that can be difficult for individual investors to access directly.
Yet ask a typical member of the public about ISAs, pensions, ETFs or conventional investment funds and there is a reasonable chance they will recognise at least some of those terms. Ask about an investment trust and I suspect the level of recognition falls considerably.
Getting beyond the LinkedIn echo chamber
The investment industry is very good at talking to itself.
LinkedIn is enormously useful to me professionally and I enjoy the debate that takes place there. But there is an obvious danger in mistaking engagement within our own professional networks for engagement with the wider public.
We post about investment trusts. Other investment professionals read the posts. Fund managers, directors, brokers, advisers and consultants comment on them. We congratulate one another on interesting insights.
And, sometimes, we risk creating an echo chamber.
If we genuinely believe that listed investment companies have a useful role to play in people's long-term savings and investments, then we need to take that conversation to the places where people actually spend their time – including audiences who have never attended an investment conference and have no intention of doing so.
That means communicating differently as well as using different platforms.
Less jargon. Shorter explanations. More video. More willingness to answer basic questions. And, importantly, being prepared to participate in conversations outside the traditional financial-services bubble.
So I've joined TikTok
In that spirit, today I have set up a TikTok account: @alexthinkingdeeply
My first video (which can be seen above or on TikTok here) was recorded as I stepped out of the overflow room at today's London Stock Exchange conference.
I appreciate there may be something slightly incongruous about an investment company director joining TikTok – but perhaps that is precisely the point.
Financial education shouldn't be confined to the platforms populated predominantly by people who already work in finance.
There is clearly an appetite for accessible financial content on TikTok and other short-form platforms. The challenge for those of us with experience in the industry is to participate in that conversation in a way that is informative, responsible and comprehensible without oversimplifying complex subjects.
My own TikTok won't be exclusively about investment trusts. My board and trustee work spans investment management, governance, marine science, diving and nautical archaeology, so I intend the account to reflect that broader portfolio – from boardrooms to shipwrecks, as I have started describing it.
But investment companies will certainly be part of the conversation.
And here is my first request: if you are interested in any of those subjects, please follow @alexthinkingdeeply, engage with the videos and, most importantly, share anything you think might be useful to someone outside our usual industry circles.
After all, reaching people who don't already know about investment trusts is rather the point.
A challenge to the industry
There was a great deal to be positive about at the London Stock Exchange today.
A packed conference demonstrated that there remains considerable intellectual energy, expertise and commitment behind the listed investment company sector. The discussion about mobilising capital, supporting innovation and connecting investors with productive assets is an important one for the UK economy.
But perhaps one measure of success should ultimately be whether those conversations escape the conference room.
So my second request is directed particularly at my fellow investment company directors, fund managers, advisers and investors.
Come and join me on TikTok.
Set up an account. Pick up your phone. Explain what an investment trust is. Talk about the companies you manage or govern. Explain discounts and premiums, dividends, gearing, boards, private assets and why the closed-ended structure can be useful. Answer the questions that might seem elementary to those of us who have spent decades in the industry.
And do it in language that somebody encountering an investment trust for the first time can understand.
This isn't about promoting individual investments or turning directors and fund managers into social-media influencers. It is about widening financial understanding and making the investment company sector visible in places where the next generation of investors is already spending its time.
If investment trusts are going to attract new investors, we cannot simply wait for those investors to discover the sector themselves.
We need to go and talk to them.
So please follow me, share the content – and, better still, start creating some of your own.
Let's see if we can take the investment trust conversation beyond the very full rooms of the London Stock Exchange, beyond the LinkedIn echo chamber, and out to a genuinely new audience.
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