216 The Stock Market Crash—And After
been called investment trusts. These organizations
are avowedly of the most speculative type and are
more risky than the investment trust proper, because
they may heavily concentrate their holdings. It is
concerning investment trusts proper that Mr.
Robinson says:
“It 1s important to bear in mind that even in the
recently closed period of excessive common stock
emphasis, there were many investment trusts which
were consistently buying in less buoyant foreign markets
 and giving their securities portfolios a strong
anchor to windward in the form of large bond holdings.
 A high proportion of seasoned and marketable
 securities, the ownership of bonds as well as
stocks, and the ability to liquidate on foreign market
 have all contributed to give some investment
trusts a further purchasing power during the recent
doldrums.”
Mr. Robinson finds that the investment trust movement
 as a whole seems to have been “relatively free
from such systematic abuses as might have been
feared in view of its recent origin, its amazingly rapid
growth, and the unprecedented situation in the stock
market.” He adds that it does not appear likely that
the American companies as a whole will pass through
“any such term of painful reconstruction, both of
financial structures and of public confidence, as many
of the British financial companies and investment
trusts did in the years 1890 to 1896.” The majority
of them show comparatively large ratios of total
investment funds raised by issuance of capital stock.