We tell the story of one shareholder who’s been investing with Alliance Trust for generations, literally.
When markets are falling, it’s tempting to cut and run. But history shows that it’s important to stay invested through turbulent times, however scary they may seem at the time, as missing the best days of the eventual recovery can have a large impact on returns generated in the long term. Kenneth Axford, aged 70, and his family can vouch for that. Personifying our tagline, ‘Investing for Generations’, they have been shareholders in Alliance Trust since it was founded in 1888. Indeed, Mr Axford believes his greatgrandfather, T.H. Smith, was among the Company’s founders.
“He and his father were property developers as well as being involved in the jute trade, inevitably, although I can’t remember which mill,” says Mr Axford. For anyone unfamiliar with the history of Dundee, the city was famous towards the end of the Victorian era for its three Js – Jute, Jam and Journalism. The jute trade has gone from the city, as has Keiller’s, the first commercial brand of marmalade in Great Britain, although journalism remains strongly represented by DC Thomson, publisher of The Beano and The Dandy, as well as the Dundee Courier. DC Thomson’s investment in the Trust also goes back to the beginning and it remains a major shareholder in Alliance Trust today.
The profits that flowed from these great 19th-century and early 20th-century industries helped to make Dundee an important source of overseas investment, especially in North America, where Alliance Trust helped to fund the early pioneers, farmers and businesspeople, as they moved westward across the United States, buying property and land in what was then an emerging market.
There have been many political and economic crises since then, not least two World Wars and the Great Depression, and the Trust is now fully focused on investing in company shares worldwide, rather than American mortgages or land. But it has remained at the core of Mr Axford’s family’s investment portfolio throughout the last 134 years, and he is now adding to his holding (via his ISA) when he has spare cash. His only regret is selling too many of the original Company’s shares that he inherited from his mother, to deal with a difficult family situation.
“I wish I hadn’t sold them now, as the Trust has done very well in recent years,” says Mr Axford. “Having grown up in Dundee, I have always taken an interest in the city, and particularly in recent years since I retired, I feel the Trust has been doing very well. It’s got, shall I say, its mojo back. I’m hanging on to the shares I’ve still got in certificated form for dear life. I’ve also got them in my ISA, which is with Hargreaves Lansdown, where I’m buying a few more shares, slowly, because they’re quite expensive now compared to what they were. I’m gradually building them up again among a few other things, mainly investment trusts and one or two company shares.”
“Having grown up in Dundee, I have always taken an interest in the city, and particularly in recent years since I retired, I feel the Trust has been doing very well. It’s got, shall I say, its mojo back.”
Now retired and living in Birmingham, where he served part of his career as a Conservative Party agent and subsequently retrained as a nurse, Mr Axford says he still feels Dundonian at heart, and that the Alliance Trust is a major part of his portfolio, which includes other shares and some buy-to-let properties in Dundee. “I’ve split some of what I have invested in my ISA to my wife Sue [to whom he got engaged at the Conservative Party Conference in Brighton the night the IRA bomb went off in 1984], because it makes sense if I decide to depart this life first, that she’s got a certain amount more capital available to help keep her going My first concern is that if I shake off my mortal coil, Sue is comfortable. I feel that’s my first responsibility, but I am conscious that I’ve inherited my Alliance shares coming down the family line.”
Mr Axford, who has three grown-up children, is currently considering running down his property portfolio, which, after tax and other regulatory changes, no longer offers the advantages it once did, and putting more of his capital into investment trusts. He and Sue are also shortly moving to a smaller house in a village just outside Birmingham for a more peaceful life, away from the now frantically busy road that the street they now live on has become.
But his heart remains in Dundee, where his great-grandfather, as well as being part of the foundations of Alliance Trust, built a big house in the affluent neighbourhood of Broughty Ferry, called Aystree House, on Victoria Road. “I understand my great-grandfather’s company was called Tay Street Builders, and if you take the ‘T’ off the Tay (the name of Scotland’s longest river, which flows out to the sea via Dundee) and the ‘T’ off the end of the ‘Street’, you’ve got Aystree. Aystree is quite a well-known landmark in Broughty Ferry. It’s been converted into flats for many years, but my great-grandfather brought his family up there.”
Today, the main house of the A-listed mansion, built in the Arts and Crafts style, is reputed to house the finest collection of Liberty of London furniture in Scotland.
Soon after the house was built in 1903, Winston Churchill became the local MP, although his frequent absence from Dundee on cabinet business, combined with bitterness and disillusionment caused by the Great War, strained this relationship and led ultimately to his refusing the offer of Freedom of the City in 1943. Mr Axford, by contrast, retains nothing but affection and gratitude for his connections with the city, and with the financial gains he and his family have made through their investments in Alliance Trust. “It’s a core part of what I hold, and there’s no way I’m parting with it,” he says
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