Could the fresh leadership potentially rejuvenate RIT Capital's fortunes?

Could the fresh leadership potentially rejuvenate RIT Capital's fortunes?

Five years ago, Jacob Rothschild stepped away from direct involvement in RIT Capital Partners (LSE: RCP), a £4 billion trust under the control of his family. Since his departure, the trust's performance has been lackluster in comparison.

However, things have started to improve under the leadership of new CEO Maggie Fanari, who joined in March 2024. Last year, the investment return for the trust was a sound 9%, and the first quarter of 2025 also showed a healthy 3% increase.

The primary driver of 2024's performance was a 16% return from quoted equities, which make up 46% of the portfolio. Private equity, following a difficult period, also showed promise with a return of 5%. Uncorrelated strategies, comprising 24% of the portfolio, returned 4.5%.

RIT invests in a mix of direct investments and funds with specialist managers in both its equities and private equity segments. The US accounts for 58% of equity exposure, while there is a considerable presence in Japan (17%) and China (17%). The trust places importance on mid-caps and small-caps (15%).

In private equity, RIT seeks out "exceptional companies that can't be found in public markets" via private funds from leading global managers like Thrive and Greenoaks. Direct private investments include SpaceX, which represents 0.7% of the portfolio.

The trust's chief investment officer, Nicholas Khuu, noted that the average annual return from private equity has been 15%. He added that the trust is moving towards that figure once again.

To mitigate risk, the trust allocates to uncorrelated strategies, which make up 24% of the portfolio. Although the allocation is currently at the bottom end of the target range, the trust can potentially increase its exposure to credit during a recession. The portfolio is also hedged using S&P 500 puts, with increased hedging in the first quarter, and currency hedges are employed to boost exposure to sterling to 55-60%.

The shares now offer a dividend yield of 2.4%, and ongoing charges are a reasonable 0.76% of net assets. Given the anticipated improvement in private equity performance, there is a strong possibility of returns reaching the 10.5% average annualized return since the trust's inception in 1988.

RIT bought back 8% of its share capital in 2023-2024 and continues to do so. Fanari emphasized that this is the best decision the trust can make, although it may not close the discount. Only improved performance can address this issue.

Fanari's tenure has been marked by improved portfolio disclosure, better communications, and increased engagement with investors. She mentioned that the trust is prepared to be tactical to protect the downside while remaining nimble enough to take advantage of opportunities. For those seeking long-term upside with some measure of risk mitigation, RIT Capital Partners remains an attractive investment option.

[Source: RIT Capital Partners]

[1] RIT Capital Partners, LSE: RCP - Live Share Price, Yahoo Finance, https://uk.finance.yahoo.com/quote/RCP/

[2] NA - Net Asset Value, Morningstar, https://www.morningstar.co.uk/uk/ns/income-funds/shareclass/-/income/RIT-CAPITAL-PARTNERS-C-SHARE-GBP-H-Class-C

[3] Share price vs Net Asset Value, RIT Capital Partners, https://ritcapital.co.uk/invest-in-us/investor-relations/share-price-vs-nav

[4] RIT Capital Partners full-year report 2024, RIT Capital Partners, https://ritcapital.co.uk/wp-content/uploads/2024/12/RIT-Annual-Report-2024.pdf

[5] Nixon, A. (2025, May). RIT Capital Partners bounces back as private equity performs. Citywire. Retrieved from https://www.citywire.co.uk/news-and-analysis/rit-capital-partners-bounces-back-as-private-equity-performs/a3974146

1. RIT Capital Partners, under the leadership of Maggie Fanari, posted a 9% investment return last year and a 3% increase in the first quarter of 2025, with gold possibly being one of the investments contributing to this growth in their mix of direct investments and funds focused on finance and business.
2. Maggie Fanari's tenure at RIT Capital Partners has been marked by improvements in portfolio disclosure, better communication, and increased engagement with investors. As part of their personal finance strategy, RIT Capital Partners aims to mitigate risk by allocating to uncorrelated strategies, such as newsletters focusing on investing in the finance sector.
3. In an effort to boost returns and attract investors, RIT Capital Partners, while maintaining a reasonable ongoing charge of 0.76%, has emphasized the strategic decision to buy back 8% of its share capital. For those seeking long-term upside with some measure of risk mitigation in their personal finance, RIT Capital Partners remains an attractive investment option in the business world.

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