SCOTTISH American Investment Company's chairman Sir Brian Ivory has declared the plunge in oil prices could turn out to be a blessing and a curse, boosting some parts of the global economy but triggering deflationary dangers elsewhere.

Sir Brian, describing the oil price collapse as the most dramatic market development of 2014, said it could also heighten problems for certain companies, countries and lending institutions.

He offers his views in his statement on the investment trust's latest annual results, published yesterday, which show the fund's total return on net asset value in 2014 was well adrift of that on the global equity market.

Scottish American Investment Company (Saints), which is managed by Edinburgh partnership Baillie Gifford, made a total return on net asset value of 2.9 per cent last year. This was well adrift of a total return of 11.3 per cent from the global equity market, the trust noted.

Sir Brian noted that an increase in the market value of Saints' debenture borrowings had weighed on its performance.

He said the trust's equity investment performance had been held back by modest exposure, relative to index weightings, to the low-yielding US market and by significant exposure to the UK.

Reflecting on the performance of global stock markets during 2014, Sir Brian said: "The standout performer has been the US, helped by a strengthening economy and, for sterling investors, by gains in the dollar."

However, he added: "In order to achieve its objectives, deliver a higher yield than global equities and service its borrowings, the company's investments necessarily differ markedly from the global equity index against which total return performance is now shown. Performance is therefore likely to differ markedly from that index."

Sir Brian declared markets had been troubled from time to time by the prospect of reduced support from central banks and the "perceived dangers of disappointing growth in Europe and China".

Saints is recommending a final dividend of 2.65p, taking the total payout for 2014 to 10.5p-a-share, a rise of 2.9 per cent.