ISA ideas: ii experts share top picks for growth, income, and more

With the end of the tax year rapidly approaching, investors have a limited window to maximise the ‘use it or lose it’ £20,000 ISA annual allowance before it resets on 6 April.

Below, investment experts at interactive investor, the UK’s second-largest DIY investment platform, share their top ISA picks across different investment styles, including growth, income, and sustainable options.

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Adventurous pick: Neuberger Berman US Multi-Cap Opportunities Fund

Alex Watts, Senior Investment Analyst, interactive investor, says: “Investors who find the concentration of the US market in the largest stocks to be disconcerting, and looking to capitalise on opportunities beyond this small set of names may consider the Neuberger Berman US MultiCap Opportunities fund. 

“The fund is unconstrained in being able to seek opportunities from large/mega-cap down to small-cap. While still able and willing to selectively invest in mega-cap stocks, the portfolio also houses businesses of varying scale and from a diverse and differentiated set of sectors to capitalise on the breadth of the US market. A focused portfolio of 30 to 40 holdings is constructed by conducting fundamental analysis, with an emphasis on cash flow and capital-allocation decisions.

“Manager Richard Nackenson doesn’t have to conform to any one investment style. Rather the portfolio comprises stocks defined as “Special Situations”, “Opportunistic” or “Classic”, making for a fairly stylistically neutral portfolio and a differentiated exposure compared with the fund’s S&P 500 benchmark.”

For income: City of London 

Tom Bigley, Fund Analyst, interactive investor, says: “The investment trust aims to provide long-term growth in income and capital, mainly through stakes in Britain’s biggest firms that are listed in the FTSE 100 index. City of London Ord (LSE:CTY)'s longstanding fund manager, Job Curtis, has been at the helm since 1991.

“Curtis is a cautious, mildly contrarian investor who doesn't ignore the macro picture, but primarily focuses on bottom-up analysis. Cash generation and physical assets are important elements, but the primary focus is dividend yield as a measure of value.

“The focus on well-managed companies that have a commitment to dividends has also helped enable the trust to consistently increase its dividend year on year, with the use of reserves demonstrating the benefit of the investment trust structure to smooth income volatility over time.

“Over the long term, returns have been solid, but arguably a bigger attraction is that the trust is a consistent dividend payer, having raised payouts each year since 1966.”

For exposure to bonds: Invesco Sterling Bond

Alex Watts says: “As geopolitical tension, a far-from-resolved inflationary picture and concerns regarding government spending across developed economies continue or even worsen in 2025, government and corporate bond yields remain heightened.

“Investors who wish to take advantage of the attractive income on offer in the UK may consider Invesco Sterling Bond Fund. The fund has managed by Michael Matthews since 2006, now alongside Tom Hemmant, and takes a flexible approach to generating income and capital growth from sterling-denominated debt.

“The flexibility allows management to invest predominantly across sterling investment grade bonds, but can also allocate to some sub-IG issuances and including subordinated debt. The managers look both at the fundamentals underlying an issuing company, as well as taking top-down view to guide positioning. The fund invests heavily in bonds issued within the financials-sector, with around 40% of the portfolio held in bonds issued by banks and insurers, then followed by Utilities and Telecoms.

“The fund’s yield of around 4.8% is attractive and Matthew’s approach has been well proven, with total returns over the long-run being impressive versus both peer group and the fund’s benchmark.”

For UK exposure: Fidelity Special Values Investment Trust

Tom Bigley says: “In stark contrast to recent years, UK equities have made an impressive start to the year, outpacing the returns of the US market. If our domestic stocks can continue to display some resilience an allocation to the UK could stand to benefit investors.

“Fidelity Special Values Ord (LSE:FSV) is a UK investment trust that seeks to find unjustly cheap companies that are due a change in fortunes. The trust has been managed by Alex Wright since September 2012. He is supported by co-manager Jonathon Winton and the extensive analyst team at Fidelity who have contributed the long and successful track record of this strategy.

“The portfolio comprises predominantly of UK listed equities, although up to 20% of total net assets can be held in non-UK listed stocks. Broadly, FSV seeks companies trading at lower multiples (generally a price/earnings ratio of well under 15x) where the market is yet to realise the future value. This bias leads Wright to also find a good deal of opportunities outside of the FTSE 100. Currently the allocation to small and mid-cap stocks is just over two thirds of the portfolio.

“Despite a strong track record for the trust, FSV trades on a current discount of over 6%, presenting an attractive entry point to investors.”

For emerging markets exposure: Goldman Sach India Equity Portfolio

Tom Bigley says: “Over the past decade, the Indian economy and stock market has seen substantial growth and is now one of the most highly valued markets in the world, despite a pullback in recent months.

“The GS India Equity Portfolio is one way to gain exposure to this thriving region and benefits from a highly experienced manager in Hiren Dasani. The fund invests in sound businesses of all sizes, preferring companies with strong competitive advantages and low or decreasing competition. Company meetings are a crucial part of the process and the fund management team’s ability to meet companies on the ground in India differentiates it from many competitors.

“The fund has delivered strong performance consistently, over multiple time periods. It is benchmarked against the MSCI India IMI index and has outperformed this index in four of the last five calendar years. Looking further out, the fund also outperformed this index and peers over five and 10 years. This is a well-diversified multi-cap portfolio with a bias towards the small and mid-cap space.”

Sustainable pick: Janus Henderson Global Sustainable Equity

Tom Bigley says: “Managed by Hamish Chamberlayne, Janus Henderson Global Sustainable Equity aims to provide capital growth over the long term by investing in companies whose products and services are considered by the team as contributing to positive environmental or social change. The portfolio of 50 to 70 stocks employs a GARP (growth at a reasonable price) strategy and is expected to show persistent biases to growth and mid-cap stocks relative to mainstream indices, and, at the sector level, to favour technology and industrials. 

"Sustainability is central to the process. For a company to be considered eligible at least 50% of their revenues is required to be aligned with the team’s 10 positive impact themes, which are mapped to the UN Sustainable Development Goals. This results in a subset of companies with long-term compounding characteristics and support from structural growth drivers.

“With its disciplined investment process and sustainability focus, this fund could be a compelling choice for an investor seeking to expand the core global equity exposure in their portfolio.”

How to broach investments amid market volatility 

Myron Jobson, Senior Personal Finance Analyst, interactive investor, says: “This ISA season has been marked by volatility, fuelled in part by market jitters over President Donald Trump’s trade wars. But investors should not be swayed by short-term turbulence. Investing is a long-term endeavour, and history shows that those who remain patient and stay the course tend to be rewarded. Time in the market is what truly counts.

“Drip-feeding investments monthly helps smooth out market fluctuations, as you’re not putting all your eggs in one basket at a single point in the year when markets may be high or low. This is a good strategy for investors who are nervous about investing during periods of heightened market volatility.

“As ever, diversification is key. This means owning a range of different investments - across asset classes, styles, and regions - to help reduce risk.”