JPMorgan Claverhouse’s 2025: Market-Beating Returns and the 53rd Year of Dividend Growth
JPMorgan Claverhouse Investment Trust has posted a strong set of full-year results to 31 December 2025, beating its benchmark, lifting the dividend again, and nudging the discount tighter with buybacks. If you like UK equity income with a bias to banks and defence, this is worth a close look.
| Key numbers (year to 31 Dec 2025) | Detail |
|---|---|
| NAV total return (debt at fair value) | +27.6% vs FTSE All-Share +24.0% |
| Share price total return | +28.9% |
| NAV per share (fair value) at year end | 911.0p |
| Share price at year end | 866.0p |
| Discount at year end | 4.9% (prior year 5.6%) |
| Total dividend for 2025 | 36.2p, up 2.3% (53rd consecutive rise) |
| Revenue return per share | 33.71p (2024: 30.15p) |
| Gearing at year end | 5.4% |
| Buybacks | 1,565,648 shares for £12.1 million |
| Post-period NAV/share price (23 Mar 2026) | 880.1p / 836.0p; discount 5.0% |
NAV outperformance: where it came from and why it matters
NAV total return of +27.6% outpaced the FTSE All-Share by 3.6 percentage points, with the share price doing slightly better at +28.9% as the discount narrowed. Management’s own attribution points to sector selection and stock picking as the main drivers, especially being overweight aerospace and defence, banks and insurance during a year when those sectors led the market.
Standout contributors included NatWest and Barclays, helped by a still-supportive rate backdrop and benign credit trends. Not holding Diageo also helped as it wrestled with destocking in North America. On the flip side, positions like Telecom Plus, Hilton Food and 4imprint detracted, and being underweight Lloyds and Standard Chartered hurt relative returns within banks.
Over five years, the trust’s NAV total return is +74.9% versus the benchmark’s +73.6% – a whisker ahead, but with 2025 clearly reinforcing momentum under the new portfolio management team.
Dividend: 36.2p and 53 years of consecutive growth
The total dividend rose 2.3% to 36.2p, marking the 53rd straight annual increase – rarefied territory for any investment trust. The board aims to grow the dividend faster than inflation over time and notes that since 2015 the dividend has risen 68.4% (from 21.5p to 36.2p), comfortably outpacing inflation of 39.7% over the same period.
A reality check: revenue return per share was 33.71p, so the dividend wasn’t fully covered in 2025, but the gap narrowed meaningfully versus 2024. The board is “very focused” on restoring full cover, helped by a refocus on holdings with good dividend growth prospects. Revenue reserves remain healthy, at 19.39p per share after the fourth interim for 2025, and there are other distributable reserves of £117.1 million. For 2026, the board intends to lift the first three quarterly dividends to 8.50p each (from 8.40p), with the fourth to be set next January.
Discount and buybacks: steady hand on the tiller
The shares finished 2025 at a 4.9% discount to NAV (debt at fair value), improved from 5.6% a year earlier. Buybacks helped – 1,565,648 shares were repurchased for £12.1 million during the year, and a further 60,054 shares for £0.5 million post year end. That’s sensible capital discipline and, in my view, supportive for ongoing discount control.
Gearing and funding: shift to CFDs to lower costs
Gearing – borrowing to boost exposure – ended the year at 5.4% (historic average 6.0%). The trust holds £30 million of 3.22% private placement notes due March 2045. The £40 million revolving credit facility was repaid and not renewed in September 2025 as the trust moved to using Contracts for Difference (CFDs) for gearing.
Quick explainer: CFDs are derivatives that provide economic exposure without owning the shares, typically at lower headline financing costs. They are capital-efficient but introduce derivative counterparty and basis risks. The board will monitor their cost-effectiveness closely. On balance, I see the switch as a potential tailwind to net returns if markets behave, with the usual caveat around derivative risk management.
Portfolio positioning: banks, defence and repeatable income growth
The portfolio held 63 stocks at year end, with notable overweights in:
- NatWest (+3.0%), Barclays (+2.1%) and HSBC (+1.8%)
- Serco (+1.9%), benefiting from defence-related orders
- ICG (+1.8%), an alternative asset manager with multi-year fee visibility
Trades told the story. The team increased NatWest – now the largest active overweight – citing attractive spreads, efficiency gains and a 5.7% dividend yield with scope to grow. New buy Softcat adds a quality, cash-generative tech reseller with a consistent dividend growth record (including special dividends), albeit on a lower starting yield of 2.4%.
They exited Barratt Redrow and Taylor Wimpey, redeploying into SEGRO and LondonMetric Property for similar rate sensitivity but better earnings visibility and yields. Elevated valuations prompted reductions in RELX and a full exit from London Stock Exchange Group; the managers will keep both on watch for better entry points as the market debates “AI losers”.
Outlook: UK value case intact, with known risks
The managers remain positive. UK equities are still attractively priced, at roughly 13x price-to-earnings, one of the few markets that doesn’t look stretched by historic standards. Add in continued M&A interest, ongoing corporate buybacks, and a market mix that rewards sectors where the trust is overweight – financials and defence – and the opportunity set looks supportive.
That said, risks are not trivial. The board flags geopolitical uncertainty in the Middle East, concerns around private credit markets, and technology disruption anxiety (the “AI winners vs losers” debate). Domestically, while inflation has fallen and rates are drifting lower, growth remains subdued and sentiment fragile. These cross-currents can widen dispersion – a stock-picker’s market, but also one that punishes mistakes.
What I like, what I’m watching
Positives
- Clear outperformance vs benchmark in 2025, driven by deliberate sector tilts and stock selection.
- 53rd consecutive dividend increase, with improving revenue cover and robust reserves.
- Proactive discount control through buybacks; discount modest at around 5% post period.
- Shift to CFDs should lower gearing costs over time if well managed.
Watch-outs
- Dividend not yet fully covered by income (33.71p vs 36.2p), though the gap narrowed.
- Derivative-based gearing adds complexity and counterparty risk.
- Concentrated overweights in banks and defence worked in 2025; if leadership rotates, relative performance could wobble.
Need-to-know definitions
- NAV total return: the change in net asset value plus dividends reinvested, showing what you’d earn if you owned the trust’s assets directly.
- Discount: how far the share price sits below NAV. A 5% discount means you’re paying 95p for £1 of assets.
- Gearing: borrowing (or CFD exposure) to increase market exposure. It amplifies gains and losses.
Bottom line
This was an assertive, well-executed year from JPMorgan Claverhouse. The combination of market-beating returns, another dividend rise, tighter discount and a more income-focused portfolio is exactly what income-minded UK investors want to see. It is not risk-free – few things are in this market – but the strategy is coherent, the balance sheet is sensible, and the UK value case remains intact. On these numbers, the trust looks in good shape for 2026.
