DESPITE their long and illustrious track record, investment trusts are often seen as the black sheep of the financial world, struggling to achieve parity with unit trusts and accused of being too complex.

Now these historic investment vehicles, many of which are based north of the border, are commanding greater attention from financial advisers and DIY investors due to favourable industry developments and falling costs.

The profile of these so-called "closed-ended funds" has received a shot in the arm thanks to the Retail Distribution Review, which has forced advisers to provide a more transparent and comprehensive service since the start of 2013.

Many IFAs who previously ignored investment trusts because they didn't offer commission are having a rethink, as the Financial Conduct Authority insists on upfront client fees for financial advice. As such, there was a 48 per cent rise in sales of investment trusts to advisers in the year up to June, according to the Association of Investment Companies (AIC).

However, the AIC has revealed that some advisers are still refusing to recommend investment trusts -even if they hold them in their private portfolios.

In a recent blog, Ian Sayers, chief executive of the organisation, said: "The AIC strongly supports people taking independent financial advice. But if the proof of the pudding is in the eating, I can't help thinking that clients deserve at least a taste of what investment companies have to offer. And for those that haven't decided on a financial adviser yet, perhaps they need to ask what's on the menu."

The AIC has also scotched claims that investment trusts, traditionally the cheaper option for investors, will no longer have a low-cost edge over their rivals as the whole industry moves towards more competitive fees. A report by Vanguard released earlier this year found that funds with lower annual management charges tend to outperform those with higher fees which eat into long-term returns.

Mr Sayers said the "historic cost advantages" offered by investment trusts are not the only explanation for their strong performance compared to unit trusts.

He cited a recent study from Canaccord Genuity which found investment companies have outperformed comparable open-ended funds in 12 out of 15 sectors over ten years, 14 out of 15 sectors over five years, and 11 out of 15 sectors over one year.

But Mr Sayers added in his blog that investment trusts have not rested on their laurels, with many cutting their fees, introducing tiered rates and scrapping performance fees altogether.

Fidelity China Special Situations Trust dropped its annual management charge (AMC) from 1.2 per cent to 1 per cent as industry veteran Anthony Bolton passed the reins onto Dale Nicholls in March. The Scottish Mortgage Investment Trust, managed by Edinburgh-based Baillie Gifford, has also reduced its annual charge from 0.32 per cent to 0.3 per cent, while Edinburgh Investment Trust, run by Invesco Perpetual, slashed its AMC from 1.21 per cent to 0.55 per cent and scrapped an additional performance fee after the departure of legendary manager Neil Woodford.

All three are now among the top five investment trusts held on platform giant Hargreaves Lansdown, which sells funds for DIY investors. Laith Khalaf, senior analyst at Hargreaves, said the number of its customers holding investment trusts had doubled in the last five years, partly because investors are choosing to access them through the platform's regular savings scheme.

Indeed, many fund houses offer their own investor-friendly savings plans, with F&C Investment Trust the first to devise one back in 1984. Those who got in at the ground level 30 years ago will have fared well. The AIC estimates anyone investing £50 every month since then would have created an investment pot typically worth £94,450 today.

Piers Currie at Aberdeen Asset Management said: "Private investors have a great range of services on offer in this space, typically at very low cost."

Speaking at an event in London, Simon Elliot, head of investment trust research at Winterflood Securities, said this impressive growth is partly down to "gearing", the ability of investment trusts to borrow extra cash to invest, which can amplify positive returns in favourable market conditions.

As investment trusts are companies listed on the stock exchange, they have a share price which can trade either at a premium (above) or at a discount (below) the net asset value of the fund. Trusts which have fallen out of favour and were previously trading at a discount have seen that gap tighten over the last ten years in a positive trend "seen across the sector", said Mr Elliot.

But both these factors are double-edged swords, warned Mr Khalaf. That's because investors can be hit with a "double whammy" of falling asset prices and a widening discount, while gearing can "magnify losses". It is widely recommended, therefore, that you only use an investment trust for medium or long-term financial goals to ride out this volatility.

Patrick Connolly, at financial advisers Chase de Vere, said: "Some investment trusts give access to high-risk specialist sectors, which won't be suitable for most investors. However large diversified trusts, such as Witan, can provide consistent long-term returns and so are an ideal buy-and-hold choice for those saving for children or in a pension."