City of London Trust's Dividend Powerhouse Continues to Impress, Boosting Shareholders by 22% Annually
The City of London Investment Trust (CTY) has been a stalwart in the UK investment landscape, focusing on income generation from a portfolio of UK shares. With a strong emphasis on dividends, the trust has managed to increase its income payments for an impressive 59 consecutive years, a testament to its consistent performance.
Unlike many of its rivals, the shares of the City of London trust currently trade at a small premium to the underlying assets. This premium, however, could potentially decrease as the trust grows to £3 billion, at which point the fees will decrease. Currently, the annual charges stand at 0.37%, lower than the average for the UK equity income sector (0.56%).
The trust's management team, Job Curtis and David Smith, have been successful in outperforming the FTSE All-Share Index over the last year, three years, and five years. In the last financial year, the trust's income payments totalled 21.3p a share, 3.4% ahead of the previous year.
Curtis, the manager of the City of London trust, believes there is more value in the UK stock market compared to other global markets. The trust's portfolio is primarily composed of FTSE 100 listed companies, with over 80% of holdings spanning the globe, ensuring a diverse investment strategy.
In an effort to maintain the trust's value, the board will buy back shares if they trade at a discount above 2%. This buyback policy demonstrates the trust's commitment to maximising shareholder value.
Despite its strong performance, the City of London trust has faced challenges in growth and attracting new investors. The trust's shares have been relatively stagnant since 2007, and net client outflows totalled $564 million in H1 2025. However, the trust's management is working to address these challenges and enhance marketing to attract investors.
Investors interested in the City of London Investment Trust can purchase shares through various DIY investing platforms, such as AJ Bell, Hargreaves Lansdown, interactive investor, InvestEngine, and Trading 212. The stock market ticker for the City of London investment trust is CTY, and its identification code is 0199049. As of now, the shares stand at just below £5. Approximately 60% of the revenues that the trust's holdings earn are overseas.
- Investors seeking opportunities in UK equity income sector might consider investing in the City of London Investment Trust (CTY), given its impressive 59-year record of increasing income payments and outperforming the FTSE All-Share Index.
- The City of London trust is dedicated to finance and business, with a strong focus on income generation from a diverse portfolio of UK shares. This commitment is evident in its buyback policy and lower Annual charges compared to the average for the UK equity income sector.
