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Investment trusts offer the chance to build an exciting and diverse portfolio. In fact, the problem is choosing which ones due to all the choice on the London Stock Exchange.
With this in mind, here are two trusts that I think should be on investors’ radars in 2026.
Buying the fear
The first is Pershing Square (LSE:PSH) from the FTSE 100. At first glance, this might seem like a fish out of water as it’s linked to Bill Ackman’s New York-based hedge fund.
But UK shareholders (myself included) are grateful for the chance to own a small stake. Because Pershing Square’s share price is up more than 20% this year. And over five years, it’s roughly doubled.
Ackman’s strategy is to invest in established companies facing challenges he believes are exaggerated or temporary. For example, he invested in Chipotle Mexican Grill in 2016 following food poisoning incidents.
In early 2023, he loaded up on Alphabet when the market feared ChatGPT would destroy Google. Then at the start of this year, Pershing Square took a big position in Uber while investors fretted about robotaxis potentially disrupting the firm’s business model.
Ackman has made solid returns from these investments (Alphabet stock’s more than tripled since early 2023). In essence, what he’s doing is buying when fear surrounds high-quality businesses, as Warren Buffett has famously done successfully for decades.
This strategy’s seen Ackman consistently outperform the S&P 500 over the long term. However, it should be noted that the Pershing Square portfolio is very concentrated (just 10-12 stocks). If a couple of his best ideas bomb, then the trust would likely underperform.
Looking to 2026 and beyond though, I’m optimistic that Pershing Square will keep chugging higher. The portfolio holds some extremely high-quality companies (including Amazon now and asset manager Brookfield).
Plus, Ackman says he’s currently eyeing up a couple of interesting opportunities. I wouldn’t bet against him unearthing another gem (lots of quality software stocks are currently cheap, for example, due to AI disruption fears).
With this FTSE 100 trust currently trading at a significant discount, I think it’s worth examining more closely.
A focus on UK quality
Turning to UK-listed shares now, we have Baillie Gifford UK Growth Trust (LSE:BGUK). I like this one for 2026 because its portfolio contains some really high-quality growth companies.
In the six months to 31 October, these helped the trust achieve a total return of 17.7%, beating the FTSE All-Share Index (16%). Top holding, Games Workshop, helped drive this performance.
However, I see quite a few high-quality names in the portfolio that have underperformed the market in 2025. These include credit report firm Experian, data analytics giant RELX, Rightmove, and Auto Trader.
Many digital platforms have struggled as investors worry about the implications of AI, but I suspect these will do better next year. I think investors are underestimating the durability of their data-driven business models.
Elsewhere in the portfolio, we see Guinness owner Diageo and cross-border payments firm Wise. Both these stocks now look good value.
Of course, a refocus on quality stocks might not happen, leaving these holdings out of favour. But with the portfolio valuation low, a 2.75% dividend on offer, and a near-10% discount to NAV, I reckon this one is also worth thinking about.
