JPMorgan Smaller Companies Investment Trust lagged its benchmark in the year to the end of July.
The total return on net assets before dilution was -7.7% (-6.4% after dilution), while its benchmark, the FTSE Smaller Companies (ex investment trusts) Index rebounded from a decline at the halfway stage to end the year up 2.1%.
Chairman Michael Quicke said: "We are in a period of significant economic and political uncertainty.
"Unprecedented levels of central bank support have failed to bring strong economic growth to many countries, and the absence of growth has resulted in political upsets both domestically and internationally.
"In this environment, we should expect markets to remain volatile, although very low interest rates help support the valuation of equities.
"The board believes that investment in smaller UK companies is attractive, and that the manager's focus on high quality growing smaller companies should deliver good long-term returns."