When you buy shares in an investment trust, you’re taking a stake in its fortunes, for better or worse. Your shares come with rights – the right to attend annual general meetings (AGMs) and to vote on issues concerning the trust – and those rights give you the chance to take an active interest in the way your money is run.

Historically, people investing in trusts through online retail platforms have had to be very determined to exercise their voting rights, because the nominee shareholding system means they are not individually registered with the trust management group.

But technology has made it much easier to find out what’s going on with your trust; and investment platforms have introduced changes to help investors use their vote.

Certainly, as more self-directed private investors enter the investment trust arena, it becomes increasingly important that they do have their say. Those with financial advisers should consult their adviser.

So, what sort of issues might you have the opportunity to vote on?

Day-to-day management of the trust is in the hands of the portfolio managers, of course, but they are answerable to an independent board of directors who make decisions in the interests of the shareholders.

Although less significant calls are left to the board’s discretion, shareholders are asked to vote on the occasional important decisions that concern the future of the trust or the way it is run, and that are likely to result in ‘material change’ for them.

For instance, shareholder votes will generally be triggered by one-off events that demand an extraordinary general meeting (EGM) rather than the standard AGM. For example, investors may be asked to vote on matters that could have a meaningful impact on their investments, including merger, takeover and wind-up proposals.

A shareholder vote may also be required at the AGM to give the trust permission to buy back shares in order to reduce the discount, or to approve mandate changes enabling the trust to distribute some capital profits as income.

In addition, investors are eligible to vote on more commonplace, ‘business as usual’ items such as the approval of the annual report and accounts and the appointment or reappointment of auditors and directors to the board.

Why investment trust shareholders should get involved – it’s more than just voting

Investment trust boards are keen for all shareholders’ voices to be heard, but there is more to active engagement than simply casting a vote from time to time.

They can also attend the AGM and other meetings; many are now run on a hybrid basis, so that investors can attend either in person or online.

The AGM is a great opportunity to understand more about the way your money is run, where you can question the board and manager about, for example, the trust’s performance or portfolio, macroeconomic concerns or sustainability policy, performance fees or dividends.

Away from the AGM, J.P. Morgan Investment Trust shareholders can stay up to date by registering for regular trust updates. These are sent by email and provide access to the latest portfolio news and views. Here you will also find video interviews/webinars with the portfolio managers, invitations to events, plus the latest third-party research and press coverage.

Getting involved so that you receive information directly from your investment trust is straightforward, but it does require you to ‘opt in’. You can do this by registering on the J.P. Morgan web page of the trust(s) you own or would like to learn more about. Once signed up with a few simple clicks, you will receive topical and relevant communications on a timely basis.

If you want to attend the AGM of a trust, the Association of Investment Companies (AIC) maintains a very useful list of all upcoming AGMs, shareholder presentations and webinars in chronological order, with details of the online option if it’s available.

Investment platforms are helping

The process of registering to attend the AGM varies between the different investment platforms; again, the AIC has details of how to go about it for all the leading platforms.

To vote, whether or not you wish to attend the meeting, you’ll need help from your investment platform. Most ask voters to message the platform with their voting instructions for each resolution, which are then submitted electronically to the trust in question, though some make it easier. The AIC provides full details of how each platform’s voting system works.

It’s getting easier all the time to be an informed and engaged investor – and as many high-profile investment trusts increasingly find themselves owned by individual private investors, it’s never been more important to know how to have your say.