ISAs have been a national treasure for savers and investors, since they were introduced in 1999, saving billions in tax for UK investors.
From the ISA allowance to the introduction of the Cash ISA, Lifetime ISA, Junior ISA and now a new potential ‘British ISA’, a lot’s changed. But what has stayed the same is they’re still an incredibly useful way of growing wealth.
For most, using the full ISA allowance every tax year might be out of reach. But that doesn’t mean you shouldn’t use as much of it as you can. After all, once we hit midnight on 5 April, this year’s gone forever.
But for the sake of this article though, let’s say you’d used the full ISA allowance each year, investing it into the same investment trust on 6 April every tax year, and reinvested any dividends.
According to new research from the Association of Investment Companies (AIC), by the end of January this year, there are 32 investment trusts that would’ve made you a millionaire. And there are two that would’ve turned that £306,560 into £2,000,000.
Investing your whole ISA allowance in one investment isn’t sensible and this example is only for illustration purposes. It's important not to put all your eggs in one basket. Spreading your money and diversifying, gives you access to more opportunities and can help reduce risk.
This article has been written independently and isn't personal advice or a guide on how or where to invest. ISA and tax rules can and do change. Investments and any income from them can rise and fall in value, so you could get back less than you invest. If you’re not sure if an investment’s right for you, ask for financial advice. Past performance also isn’t a guide to future returns.
Remember, investment trusts can sometimes invest in specialist higher-risk areas like smaller companies and unlisted (private) companies. Lots also use derivatives and gearing (borrowing to invest) which adds risk. Investors should only invest in them if they have the time and knowledge to carefully select and monitor them.
The 32 ISA millionaire investment trusts
Rank | Trust name | AIC sector | % share price total return, 06/04/1999 to 31/01/2024 | Total ISA investment value at 31/01/2024 |
|---|---|---|---|---|
1 | HgCapital Trust | Private Equity | 3,700 | £2,254,391 |
2 | Allianz Technology Trust | Technology & Technology Innovation | 1,894 | £2,095,955 |
3 | Polar Capital Technology | Technology & Technology Innovation | 1,573 | £1,912,656 |
4 | Scottish Mortgage | Global | 1,366 | £1,639,261 |
5 | Scottish Oriental Smaller Companies | Asia Pacific Smaller Companies | 4,024 | £1,538,589 |
6 | abrdn Asia Focus | Asia Pacific Smaller Companies | 3,742 | £1,491,435 |
7 | JPMorgan American | North America | 889 | £1,413,500 |
8 | Pacific Horizon Investment Trust | Asia Pacific | 2,334 | £1,303,270 |
9 | JPMorgan Global Growth & Income | Global Equity Income | 923 | £1,268,898 |
10 | BlackRock Throgmorton Trust | UK Smaller Companies | 1,252 | £1,214,138 |
11 | Worldwide Healthcare Trust | Biotechnology & Healthcare | 1,999 | £1,197,232 |
12 | International Biotechnology | Biotechnology & Healthcare | 1,846 | £1,194,730 |
13 | Fidelity European Trust | Europe | 1,725 | £1,188,448 |
14 | Biotech Growth Trust | Biotechnology & Healthcare | 1,317 | £1,169,361 |
15 | Canadian General Investments | North America | 1,439 | £1,159,765 |
16 | BlackRock Smaller Companies | UK Smaller Companies | 1,138 | £1,157,120 |
17 | Mid Wynd International | Global | 1,182 | £1,142,541 |
18 | Rights & Issues Investment Trust | UK Smaller Companies | 1,588 | £1,134,352 |
19 | JPMorgan UK Smaller Companies | UK Smaller Companies | 1,268 | £1,123,473 |
20 | European Smaller Companies | European Smaller Companies | 906 | £1,112,995 |
21 | JPMorgan European Discovery | European Smaller Companies | 1,664 | £1,087,689 |
22 | JPMorgan US Smaller Companies | North American Smaller Companies | 1,238 | £1,086,589 |
23 | Herald Investment Trust | Global Smaller Companies | 855 | £1,077,135 |
24 | JPMorgan Indian | India/Indian Subcontinent | 1,778 | £1,076,331 |
25 | Montanaro European Smaller Companies | European Smaller Companies | 917 | £1,066,051 |
26 | ICG Enterprise Trust | Private Equity | 580 | £1,065,553 |
27 | AVI Global Trust | Global | 1,482 | £1,058,026 |
28 | Fidelity Asian Values | Asia Pacific Smaller Companies | 806 | £1,055,507 |
29 | BlackRock World Mining Trust | Commodities & Natural Resources | 1,853 | £1,037,056 |
30 | Pantheon International | Private Equity | 1,017 | £1,027,265 |
31 | F&C Investment Trust | Global | 681 | £1,007,460 |
32 | Henderson European Focus Trust | Europe | 745 | £1,005,182 |
% share price total return is for a single lump sum invested at the beginning of the period. Total ISA investment value is the total value of an investment on 31/01/2024 if the maximum ISA limit for each year had been invested every year from 1999 to 2023, with the investment being made on 6 April each year.
Looking to use your ISA allowance before the 5 April deadline this tax year and aren't sure where to invest? See our latest investment trust ideas, picked out by our expert investment analysts.
How to pick investments for an ISA
If you're looking for inspiration from our investment research team on where to invest your ISA this tax year, explore our latest ISA investment ideas.
Or you can use our Wealth Shortlist.
It's designed to help investors build and maintain a well-balanced and diversified portfolio. We've put funds under the microscope to make sure the list only contains the funds that our in-depth analysis shows have the greatest long-term performance potential.
Leave day-to-day investment decisions to the experts
If you’ve got a Stocks and Shares ISA and want a team of experts to look after the day-to-day investment decisions, think about a Ready-Made ISA.
You can pick from four ready-made investments, letting you choose how to balance risk and potential returns.
All you'll need to do is check in on your investment from time to time to make sure it still meets your needs and objectives.
HL Ready-Made Investments are managed by our sister company Hargreaves Lansdown Fund Managers Ltd.
It's quick and easy to open an ISA, taking just minutes online once you have read all the important information.
If you get started before the tax year deadline on 5 April, you could make the most of this year’s £20,000 ISA allowance.
Before you apply, make sure you're happy with our terms and conditions (including Tariff of Charges) and key features. Then all you need is your debit card and National Insurance number to hand.
Although this is changing in the new tax year, right now you can’t pay into more than one of the same type of ISA in the same tax year. But you can split your ISA allowance in any proportion you want between the different types so, for example, you could invest £10,000 in a Stocks and Shares ISA and the remaining £10,000 in a Cash ISA.