Why do investment trusts outperform?

Past performance is a notoriously unreliable beast, but one thing it does suggest is that over time, closed-ended funds such as investment trusts tend to outperform their open-ended cousins. Recent research by broker Winterflood showed that over 10 years, closed-ended funds outperformed open-ended funds in seven out of eight major sectors (on a share price basis, taking account of ongoing charges but not the cost of purchase), covering both developed and emerging markets and larger and smaller companies. The only sector in which investment trusts underperformed (over the decade to Septem...