The City of London Investment Trust will mark a milestone this year by increasing its annual dividend for the 60th consecutive year, becoming the first investment trust to achieve such a record. With assets under management totaling approximately £3 billion, the trust has consistently delivered steadily rising payouts since 1966, a span that has encompassed multiple market cycles and economic upheavals.

Fund manager Job Curtis, who has overseen the portfolio for 35 years, has guided the trust through significant events including the 1987 stock market crash, the dotcom bubble burst, the 2008 global financial crisis, and the recent Covid-19 pandemic. Curtis’s approach emphasises stability and resilience, with a portfolio concentrated predominantly in UK-listed companies. Currently, over 90% of the trust’s investments are in British equities.

Curtis has notably avoided exposure to artificial intelligence-related stocks, citing concerns over the vast spending underway by US technology giants—referred to as hyperscalers—which are projected to invest more than $600 billion this year. While he acknowledges the potential risks of AI investments, he pointed to sectors poised to benefit from productivity improvements and cost reductions, such as banking, as safer opportunities.

The trust’s top ten holdings illustrate its preference for established, cash-generative companies. These include major UK banks HSBC, Lloyds, and NatWest, oil giants BP and Shell, consumer staples firms Tesco and Unilever, tobacco group British American Tobacco, and fund manager M&G. Curtis highlighted the importance of diversification across sectors such as financial services, energy, consumer staples, and tobacco rather than overconcentration in any single area.

Performance figures reflect the strategy’s success, with a one-year total share price return of 24.5% and a five-year return of 92%. Compared to the broader UK market, funds invested in the trust and reinvested dividends over the long term have significantly outperformed, highlighting the benefits of steady, compound income growth. For example, a hypothetical £1,000 invested in 1966 and reinvested dividends would be worth around £1.3 million today, compared to £700,000 in the wider UK stock market.

Curtis credits the trust’s commitment to increasing dividends annually as a disciplined strategy rather than a risk. He explained that in years with strong dividend payments, the trust can reserve up to half of its income, enabling it to sustain distributions even when market conditions deteriorate. This approach helped the trust maintain payouts during sharp market dividend cuts in 2020, unlike many other funds.

Adopting a conservative stance, Curtis prioritises companies with solid cash generation and low debt levels. At 65, he shows no intention of stepping down, implying that investors can expect continuity in the management philosophy that has underpinned six decades of uninterrupted dividend growth.