Investment Trust- Thoughts (August 2024)
Investment Trust- Thoughts (August 2024)
Investment trusts realising assets spreadsheet
For more information on Investment trusts visit:
Association of Investment Companies.
https://www.theaic.co.uk/
Free to sign up. On the site you can create portfolios, screen and compare Investment Trusts by Geographic region, Sector , Yield and more. A few Trusts who are not AIC members have limited data.
Jonathan Davies's website https://money-makers.co/.
You can also sign up(Paid membership) for insights on Investment Trusts from him and others. Weekly email and podcast .
Citywire do a daily Investment trust email. Free, does have sponsored content but keeps you up to-date with Investment Trust news.
https://citywire.com/investment-trust-insider
Trustnet have an Investment trust section. https://www.trustnet.com/
Plenty of performance data on that site.
Edison cover Investment Companies and do a monthly Investment trust round up. You can sign up for free.
https://www.edisongroup.com/equities/investment-companies/.
You can sign up for newsletters/fact sheets from most of the Investment Trusts on their websites.
For ETF's I use https://www.justetf.com/uk/. You can screen buy region, sector and see performance comparisons.
July 2024 Investment Trust monthly performance.
Equity investments only.
Top 10
Downing Strategic Micro-Cap Investment Trust (LON:DSM) +48.8%
Castelnau (LON:CGL) +31.2%
Sure Ventures (LON:SURE) +29%
Worsley Investors (LON:WINV) +15.5%
Jpmorgan Uk Small Cap Growth & Income (LON:JUGI) +15.4%
JPmorgan US Smaller Companies Investment Trust (LON:JUSC) +15.1%
CT UK High Income Trust (LON:CHIB) +13.9%
Investment (THE) (LON:INV) +13.5%
Blackrock Throgmorton Trust (LON:THRG) +11.5%
Blackrock Smaller Companies Trust (LON:BRSC) +10.7%
Bottom 10
Vietnam Enterprise Investments (LON:VEIL) -22.4%
New Star Investment Trust (LON:NSI) -19.4%
Manchester And London Investment Trust (LON:MNL) -13%
Allianz Technology Trust (LON:ATT) -8.8%
Fidelity China Special Situations (LON:FCSS) -8.8%
Jpmorgan China Growth & Income (LON:JCGI) -8.6%
Polar Capital Technology Trust (LON:PCT) -8.5%
Augmentum Fintech (LON:AUGM) -7.6%
Baillie Gifford China Growth Trust (LON:BGCG) -7.3%
Jpmorgan Asia Growth & Income (LON:JAGI) -5.3%
All asset classes
Top 5
As per equity list Top 10
Bottom 5
Vietnam Enterprise Investments (LON:VEIL) -22.4%
New Star Investment Trust (LON:NSI) -19.4%
Manchester And London Investment Trust (LON:MNL) -13%
Riverstone Credit Opportunities Income (LON:RCOI) -12.2%
Gresham House Energy Storage Fund (LON:GRID) -10%
Disclaimer
This is not financial advice. Our content is intended to be used and must be used for information and education purposes only. Please read our disclaimer and terms and conditions to understand our obligations.
151 comments
Hydrogenone Capital Growth (LON:HGEN) bowl now looks confirmed.
Scottish Mortgage Investment Trust (LON:SMT) 30th September 2024.
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Bought back into Market Access STOXX China A Min Var Idx ETF EUR C (LON:M9SV) -it had dropped after I sold and saw this a short time ago "
** U.S.-listed shares of Chinese companies rise premarket trade on heavy buying from sovereign fund Huijin, and expectations of fresh stimulus for the property sector
** State-backed Central Huijin Investment boosted ownership in a handful of blue-chip ETFs, according to the fund manager's mid-year reports"
Charles,
Do you think Tritax Big Box REIT (LON:BBOX) will be admitted to the FTSE100 later this month and if so do you think more institutions and trackers will have to buy due to this? Or do you think they would’ve already done that in anticipation? I noticed the SP has been ticking up slightly over the last few months since taking over the smaller REIT.
Promotion to the FTSE100 seems to be between Tritax Big Box REIT (LON:BBOX) and Hiscox (LON:HSX) atm
All comments welcome.
I hold.
Graham.
Graham, Looks like Burberry and Easyjet will go. Not sure if it will make a difference to BBOX to be honest, but I did sell Easyjet on the basis trackers will have to sell it- so on the same logic it should.
CT Private Equity Trust (LON:CTPE) I sold this a few months back as share price had gone no where. This Citywire article has the joint broker suggesting a 25% upside. Stifel reckon not- due to 15.5% gearing and little firm indication of asset sales materialising any time soon. Whilst the yiled is decent at 6% not sure I will be rushing back to buy in. I am afraid I heard a few years of positive quarterly updates from the manager, but no price movement Better PE funds are available I think- I have held Oakley Capital Investments (LON:OCI), for example, for 4 plus years and has done well. https://citywire.com/investmen...
Tritax EuroBox (LON:EBOX) : The deadline for Brookfield Asset Management to announce a firm intention to make an offer for Tritax EuroBox plc has been extended to 23 September 2024. There can be no certainty that a firm offer will be made.
Are holders expecting much of an upside on today’s price of 66.50?
I don't see why an offer shouldn't be close to their NAV ? I'm sanguine about it as I feel that the economics for REITS are improving and therefore if no offer is made and the price drops then it will be a chance to top up and lock in the dividend and capital appreciation in a lowering interest rate environment.
I’m happy continuing to hold Tritax EuroBox (LON:EBOX) while this supposed bid situation drags on, and on and on………
If there is eventually an offer I disagree that it could be near to NAV even though agreeing with bsharman that the economics for REITS are improving and with growing evidence the sector has bottomed. But evidence for that happening is not the same as the certainty a bidder would surely want if prepared to pay nearly the full current NAV. Happy to be wrong on this!
My guess is a take out price around 72p which is useful further upside even excluding the very good dividend yield. If there’s no bid then again agree; if the share price falls, as is likely on that news, I would buy some more as fundamentals justify the current price and not a lower price. I wouldn’t buy at the current price as other REITS have more upside potential.
I’m happy continuing to hold Tritax EuroBox (LON:EBOX) while this supposed bid situation drags on, and on and on………
Blimey, I'd assumed this would have been resolved yonks ago. I sold out taking the view that it was dead money otherwise. Stuck the cash into Supermarket Income REIT (LON:SUPR).
There's a possibly similar situation unfolding at Warehouse Reit (LON:WHR) where the Blackstone bid is (in my view) derisory. They even had the cheek to suggest that the last dividend was part of the value of the bid.
I don't hold any candle for broker views on anything very much, but Shore Capital think it's worth 133p a share, and I'm willing to let confirmation bias take its course on this occasion.
Frankly I don't very much like bids for any of my holdings as I buy to hold and achieve long term capital gains and income streams, not see a bunch of American adventurers run off with my future profits for a derisory capital gain. Spectris (LON:SXS) is my latest portfolio holding to suffer the curse of a US based takeover at a 70% (!) premium. Hopefully there'll be a counterbid at least.
Meanwhile this bull market climbs a wall of worry ...
timarr
Has anyone looked at EJF Investments (LON:EJFI) "To generate attractive risk adjusted returns by investing in opportunities created by regulatory and structural changes impacting the financial services sector." Trades on a large discount of 41%. Performance NAV wise seems pretty poor, underperformed the AIC-Debt Structured finance sector over 5 years-5 years was 37% EJF 17%. But with a wide discount and poor performance maybe something will happen
Yes, briefly, but I was under the impression that these were effectively junk bonds..? Obviously diversified and at a discount....
Brucie 5 Probably best to stay clear- not my smartest income idea, down 7%. But they have invested in this recently "
The Board of EJFI, which provides investors exposure to a diversified portfolio of debt issued by smaller US banks and insurance companies and participation in certain management fee income streams of EJF Capital LLC ("EJF"), is pleased to announce that on 3 June 2025, EJFI invested in its third Credit Risk Transfer ("CRT") investment arranged by EJF.
This investment was part of a $150 million securitization transaction for Third Coast Bank, a Texas banking association and wholly owned bank subsidiary of Third Coast Bancshares, Inc. (NASDAQ: TCBX). The transaction was secured by interest in a portfolio of commercial real estate loans originated by the bank. Certain funds managed by EJF invested an aggregate of $22.5m in the first loss tranche of the securitization, $6m of which was invested by EJFI. The estimated yield on the CRT investment is 15.85%, with an expected duration of 2.75 years."
The last NAV was £1.59
They will present the interim results of the Trust for the six months ended 30 June 2024.
Tuesday 1 October 2024
09:00 - 10:00
Anyone know anything about the below?
Hansa Investment (LON:HANA) on a large discount atm. Has some interesting holdings. One of which is (25.8% of their assets according to AIC website) Ocean Wilsons Holdings (LON:OCN) who in turn own 56% of Ocean Wilsons, who are in discussions to possibly be take over by a third party?
This situation needs some real scrutiny to see if there is an opportunity here. Does anyone have a view on this one? I heard the Hansa Investment (LON:HANA) mentioned on a podcast on Kyle Caldwell from Citywire today.
Hansa Investment (LON:HANA) also has a small stake in Pershing Square Holdings (LON:PSH) .
Graham.
Graham, I did look at it a six or so months ago due to holding in Ocean. Decided not to invest partly due to the Salomon family/ managers holdings, not sure if “family” interests will be the same as mine. But it is at a decent discount despite recent rise.
Will have a good look at all the firms not ones I have heard of just run over them and note Charles points about Family interests though I have found this to be beneficial at times as seem to give firms/trusts a longer term outlook
They are doing an online presentation on the 25th September
https://hansaicl.com/
Seraphim Space Investment Trust (LON:SSIT) (I hold) Interesting write up by Citywire https://citywire.com/investmen...
Montanaro European Smaller Companies Trust (LON:MTE) (I hold) Quoted data research https://quoteddata.com/researc...
If not already holding any Trusts in Emerging Markets, now could be a good time to get in. Here are all the Trusts in the Global Emerging Markets sector:-
https://www.theaic.co.uk/aic/f...
One that looks tempting that I don’t hold yet is JPmorgan Global Emerging Markets Income Trust (LON:JEMI)
Just a note now on buybacks. A lot of Trusts including are disappointed that they are trading at discounts, and then they get disappointed when as is happening a lot, the discount widens even further after they carry out big buyback programmes. An obvious answer to that dilemma is to abandon those buybacks and invest that money instead.
e.g JPmorgan Global Emerging Markets Income Trust (LON:JEMI) bought back 1,109 million shares. That cost around £1.4 million. But note this! That buyback only increased NAV by 0.1%!! So even if spending (wasting imo) £65 million on buybacks, even that big sum would only increase NAV by 5%…..AND there’s nowt to stop the discount from widening by 5% or more to make that £50 million down the drain! Isn’t a rethink on buybacks needed.
There have been posts recently wondering whether it’s still worth holding or buying one or both of the Vietnam Trusts. A big yes imo and I’ve held VinaCapital Vietnam Opportunity Fund (LON:VOF) and VietNam Holding (LON:VNH) since they launched and and added more after the 2008:banking crash, except for selling temporarily in the covid crash and buying them again in 2020. Performance has been fabulous, with VinaCapital Vietnam Opportunity Fund (LON:VOF) up10 fold since 2009 and VietNam Holding (LON:VNH) 15 fold.
Again as with a lot of Investment Trusts at present, it might require patience before the next big gains. Best way to find out more is to read every monthly investment update from both the Vietnam Trusts. I’m not keen on the 3rd Vietnam Trust Vietnam Enterprise Investments (LON:VEIL) .
Here’s the aic link for the Vietnam Trusts. Note that VinaCapital Vietnam Opportunity Fund (LON:VOF) remains at a big 21% discount:-
https://www.theaic.co.uk/aic/f...
Barings Emerging Emea Opportunities (LON:BEMO) is worth looking at. They publish interesting factsheets- including 3 so far country spotlights. https://www.barings.com/en-gb/...
I bought iShares MSCI Mexico Capped UCITS ETF USD (Acc) (LON:CMX1) too soon- looking at 20% loss at the moment. Long term Mexico looks promising, but there could be some further weakness. The USA/Mexico trade agreement needs to be re-signed next year so the USA elections are of significance. I am re-examining my stance and it maybe I should sell and wait to buy back in later. It is though a fairly small holding in my ISA. My concerns are also inflation which is still at the top end of the target range and currency weakness.This research from Schroders covers most of the issues. https://www.schroders.com/en-g....
This weeks Investor Meet Company. CT Private Equity Trust (LON:CTPE) 29 Aug at 11.30 am and BBGI Global Infrastructure SA (LON:BBGI) on 29 Aug 14.30.
Nick Train added another £200K of Finsbury Growth & Income Trust (LON:FGT) shares on Friday. He now owns 3.2% of the company worth £46m at current prices. But the discount and recent performance remain stubbornly poor against his previous record!
July factsheet noted Unilever (LON:ULVR) was up +9.9% but Burberry (LON:BRBY) down -11.7%. The commentary on both plus Diageo (LON:DGE) is well worth reading. https://tinyurl.com/2us9rvua
I have a degree of sympathy with Nick Train re Brby- I bought recently as thought it had bottomed- sadly it was not the case and has fallen sharply below what I paid. Something will happen there I am convinced though.
An excellent article from Maynard Paton on Lindsell-Train IT. Did make me consider investing.
https://knowledge.sharescope.c...
Agree Kevin that it’s a very good article on Lindsell Train Investment Trust (LON:LTI) . One point he missed was that Nick Train warned several times that the share price was way too high when Lindsell Train Investment Trust (LON:LTI) was trading at a ridiculous 100% premium to NAV. Much of the share price fall since that £2000 a share peak to around £800 now is because that massive premium has gone and Lindsell Train Investment Trust (LON:LTI) is now at a 18% discount.
It’s not the only Trust where much of the share price fall is simply because the share price has gone from way overvalued on a big premium to a big discount. Another is Augmentum Fintech (LON:AUGM) which I hold and have posted on here. It’s gone from a 40% or so premium to a 36% discount and while that was happening with the share price falling 40% from 173p to current 108p, NAV continued to increase.
Augmentum Fintech (LON:AUGM) looks a stunning bargain but I’m beginning to wonder whether investors will ever realise that , or what Augmentum Fintech (LON:AUGM) Managers can come up with to get the share price moving up at last.
Back to Lindsell Train Investment Trust (LON:LTI) A big put off for small investors is that £800 share price. Don’t know why they haven’t opted for a share split. I don’t hold but would be tempted if the share fell further still.
The following article prompted me to look at North Atlantic Smaller Companies Investment Trust (LON:NAS) and Oryx International Growth Fund (LON:OIG).
https://tinyurl.com/4kcfhp2a
Rockwood Strategic (LON:RKW) gets a lot of the attention these days, maybe North Atlantic Smaller Companies Investment Trust (LON:NAS) and Oryx International Growth Fund (LON:OIG) go under the radar a little these days ? I've noticed Oryx International Growth Fund (LON:OIG) particularly features on the Stockopedia biggest movers list during the day but not usually at the end of the day. Any thoughts ?
The top 10 as per the HL site accounts for approx 56% with 8 of those positions listed on the London market. StockRanks are not that great but this is an activist trust after all.
Is not the spread on Orxy quite large- not dealt in it but i am sure I did consider and the spread put me off. Might be wrong.
Interview with Peter Hewitt, manager of both CT Global Managed Portfolio Trust (LON:CMPG) and CT Global Managed Portfolio Trust (LON:CMPI). I like this guy because he has been around a long time, has seen a lot of ups and downs in the market and makes reasonably sensible calls on some of the larger, more mainstream trusts to hold for the long term.
https://tinyurl.com/3nxb2rpx
# PH is focusing on 3 themes: UK, private equity and what he calls secular growth trusts (health & tech).
# Discusses when to sell.
# Long(ish) discussion on the Baillie Gifford trusts. PH sold Edinburgh Worldwide Investment Trust (LON:EWI) after a pre-longed period of underperformance. He used the proceeds to increase his stakes in Scottish Mortgage Investment Trust (LON:SMT) and Monks Investment Trust (LON:MNKS) and draws a distinction between the 2 trusts. Scottish Mortgage Investment Trust (LON:SMT) owns large stakes in privately quoted companies that could be listed in their own right in the next few years. Monks Investment Trust (LON:MNKS) is seen as lower risk with very little private equity and a larger number of holdings.
# PH likes to avoid single country trusts, especially in emerging markets because he doesn't know enough about them. SSB: down side of this approach is that investors miss out on excellent opportunities like Vietnam.
# PH has sold his direct property holdings and outsourced that piece of his trusts to TR Property Investment Trust (LON:TRY). SSB: from my perspective, I completely understand Ken's preference for the higher yielding trusts but like Charles, I quite like TR Property Investment Trust (LON:TRY). Remember the quoted discount for TR Property Investment Trust (LON:TRY) is not the true discount as we also need to take into account the discounts that the underlying holdings are trading on (same principle as Migo Opportunities Trust (LON:MIGO)). Horses for courses.
# Finally, PH thinks that underlying performance is more important than discounts. Gearing turbo charges that performance (SSB: both up and down, important to remember that).
Thanks SSB, I also enjoyed listening to the Hewitt podcast, and it has me thinking on whether to consolidate a portion of my IT portfolio in to his fund instead (CT Global Managed Portfolio Trust (LON:CMPI); I overlap with a number of his top10, and probably easier to pay him to tweak the allocations!
it has a decent divi (6%), but spread is ~4% (although this would be a buy/hold/forget holding so not overly bothered on that).
At the back of my mind I keep thinking I should have exposure to the biotech industry. I did hold Arix- not a great investment and sold RTW Biotech Opportunities (LON:RTW) after the takeover and did break even. Looking now it would seem Syncona (LON:SYNC) is on the largest discount 33%, but the 5 year performance has been poor over. the last 5 years with a -10% NAV performance and a -49% share price performance as the discount has widened. Polar Capital Global Healthcare Trust (LON:PCGH) has the best 5 year share performance +81% which is actually better than the NAV performance of +73%. It has the second best 10 year performance behind International Biotechnology Trust (LON:IBT) on +222% v. PCGH of 196%. But again the share price has outperformed the NAV over 10 years -+176%.
So the dilemma do I but one of the 2 proven performers or take a risk and buy SYNC or Biotech Growth Trust (LON:BIOG) which have both underperformed. I am leaning to SYNC. In the last fact sheet they state "Upcoming capital access milestones and potential key value inflection points
As we build and scale our companies, there are opportunities to deliver milestones that drive
access to capital (capital access milestones) and milestones that we believe have the potential to
drive significant NAV growth . They have 2 investments they state are close to being on the market- Autolus and Beacon, 3 more moving towards publishing definitive data. But Autolus was down 76.7m in the last quarter- it is a quoted company-although since June the share price has risen.
Any thoughts would be welcome.
Charts below show performance over 1 year. AIC link is here
Hi Charles
it's one of those sectors where investment trusts really do come into their own! Inexperienced investors would be influenced by story stocks (I know I was once upon a time). But the benefits of investment trusts (limited share capital and gearing especially) allows investors to benefit from specialist knowledge. Healthcare & biotech needs to be a long-term investment. I don't hold but I would tend to go for one of the larger mkt cap options as this *should* attract money from asset wealth mgt companies.
I used to get the updates from International Biotechnology Trust (LON:IBT) which were always telling the same story ie: we are bullish now because we think we are at the bottom of the cycle. I know International Biotechnology Trust (LON:IBT) holds a spread of assets from established pharma companies to much smaller pre-revenue firms.
I recently signed up for the Bellevue Healthcare Trust (LON:BBH) monthly news letter as Andrew McHattie said he held it in high regard on last week's podcast.
It's a work-in-progress for me too!
Biotech & Healthcare sector by 10 year performance:
And also by mkt cap. I am surprised International Biotechnology Trust (LON:IBT) is the smallest trust. Worldwide Healthcare Trust (LON:WWH) is a more generalist trust and probably the safest in the sector but probably not what you are looking for.
Thanks ShoeShine. I will probably buy Syncona- I have respect for the Wellcome trust who co-founded it and own 28%. My daughter worked there on a graduate scheme a while ago and they were doing interesting things. But that was 12 years ago!
Thanks for yet more great posts on a range of Trusts ShoeShineBoy . I’ll come back sometime tomorrow on the Biotech/Health sector especially where there’s a strong case for holding one of them.
Meanwhile re the days when like so many on Mike Walters site you liked story stocks that so often went on to disappoint; if only in those days you had shared my enthusiasm for and posted on, Investment Trust warrants and subscription shares! You might well have persuaded more people than I did of their big plus points and generated more interest in them there.
So many of the Investment Trust warrants and subscription shares multibagged on modest gains for the underlying Investment Trust share prices. Such was the gearing on some that they doubled or more on a share price gain of less than 10%. The best gain I got was with Geiger Counter warrants that I bought for 0.85p and they went up nearly 60 times in just a few months. My rule of not too much in any one portfolio holding meant that I sold most of them before they topped out in the mid 40s. Even so it was a transformational and memorable buy.
Andrew McHattie, now a regular on the MoneyWeek weekly Investment Trust updates, was a key figure in promoting Investment Trust warrants and he issued a very good monthly Investment Trust warrant newsletter which included a successful portfolio too.
If the Investment Trust sector wants to get a higher success rate with new issues which have almost dried up, then one way to do it might be by again issuing free warrants/subscription shares on say a 1 for 5 basis as a sweetener and to avoid the big disadvantage that it is otherwise best to buy a new issue once it starts trading and goes to a discount rather than pay the full NAVat launch . Then, once trading starts the subscription shares are traded the same as the new issue Investment Trust shares. Some used to soar on the very first day of trading. I’m very keen on Investment Trusts now, but in those good old days it was often far better just to hold the subscription shares.
Finally in case anyone is confused; warrants and subscription shares are the same in all but name, but warrants can’t go in to ISAs but subscription shares can. It was John Lee, the first ISA millionaire who pushed successfully to get subscription shares allowable in ISAs.
A few thoughts on the Biotech/Health Trusts following up ShoeShineBoy’s post here yesterday.
I’ve now looked at the most recent updates and Kepler comment on all of them. A repeating theme is that the sector is now recovering. I only hold International Biotechnology Trust (LON:IBT) which I bought too soon 2 years ago ahead of a further 12% share price fall, but it is now 10% up, providing support for the sector is now recovering claims.
There’s an investment case for most of them. Note that some have nearly all their investments in the US. e.g Biotech Growth Trust (LON:BIOG) 80% in US, International Biotechnology Trust (LON:IBT) 75%, Worldwide Healthcare Trust (LON:WWH) 68%. Lowest in US is Polar Capital Global Healthcare Trust (LON:PCGH) with 50% and a portfolio spread across 13 Countries. This one has performed very well.
Best for dividend yield is International Biotechnology Trust (LON:IBT) looking to pay 4% of NAV at the NAV level at the end of August. So IF the sector recovers strongly International Biotechnology Trust (LON:IBT) could be paying a big dividend in time.
Not a sector for quick in and out trades; so it will only appeal to investors here looking to buy and hold. It’s a sector that in the past has had boom and bust spells. Current claims by most of the Managers in their Results comment are that it’s likely we’re in the early stages of the next good run.
All of them can be compared using this aic link:-
https://www.theaic.co.uk/aic/f...
Thoughts anyone?
Almost inevitably Tritax EuroBox (LON:EBOX) ha e extended the PUSU with Brookfield again. New close out date is 23 September. Hopefully this will be the last extension. Did doubt the middle of the summer would see anything done so I guess this is the best result. Frustrating though as I'd like to take the proceeds and redeploy. But equally don't want to walk away and leave c10% on the table for the sake of a little patience....
Scottish Oriental Smaller Companies Trust (LON:SST) I do not hold this, but looking at the 10 year record I probably should do as I can only see the regions they invest in doing well over the next 5-10 years. See latest factsheet.
So I have sold the China ETF I held Market Access STOXX China A Min Var Idx ETF EUR C (LON:M9SV) and bought SST. SST has 16% in China, underweight re the index but given that M9SV has been stable since I purchased a few months back gives me confidence China may have bottomed !
I have been watching Indonesia through an ETF for a while HSBC MSCI Indonesia UCITS ETF USD (LON:HIDR) . Abrdn released this report re their Abrdn Asia Focus (LON:AAS) trust which confirms what I am thinking- though not bought in yet. https://www.asia-focus.co.uk/e...
There is no doubt that Indonesia is seeing wealth creation on a significant scale although the spectre of corruption and cronyism hangs heavy. You may be aware of the demonstrations taking place this week by people across Java unhappy with the “manipulation” of the election process.
Charles are you still invested in VietNam Holding (LON:VNH) ? Earlier in the year you covered this and I was convinced by your investment case and opened a position. However momentum has ebbed away recently.
I am indeed- it is a core holding. Momentum has eased at the moment, but the Market should be classified as an emerging market rather than frontier, so should attract more eTF trackers etc. "Ensuring continued stable development, maintaining the upgraded status and avoiding a downgrade were key topics discussed at the “Motivating the Stock Market Upgrade” seminar held in Hà Nộion July 2." See link
The economy still continues to grow rapidly.
Something I don’t think has been talked about yet is the government starting up a direct competitor to the current investment trusts invested in renewable energy Greencoat UK Wind (LON:UKW) NextEnergy Solar Fund (LON:NESF) Etc
https://great-british-energy.o...
How this will play out I don’t know and I don’t think anyone else does either but I think anyone holding one these trusts where the majority of the assets are based in the UK need to take note of the risks
Great news for holders of Doric Nimrod Air Two (LON:DNA2) today. Emirates have agreed to purchase remaining 5 planes at end of lease for $40m per piece. Nice jump up today in SP and good read across for Doric Nimrod Air Three (LON:DNA3) .
Yep good news for all the aircraft leasing firms holding A380s
Seraphim Space Investment Trust (LON:SSIT) has jumped up today - currently over 8% - on no news I can see. Does anyone know if it’s been mentioned anywhere?
Indie- it does this from time to time. Never managed to get to the reason why.
Thanks, Charles. Kind of fitting for a space investment trust to zoom up, I guess.
New TR Property Investment Trust (LON:TRY) factsheet. (I hold) https://www.trproperty.com/jul...
Thanks Charles. I hold TR Property Investment Trust (LON:TRY) as one of my exposures to property (others being Tritax EuroBox (LON:EBOX) & Supermarket Income REIT (LON:SUPR).
I bought it around the turn of the year - from memory I think there was an interview with its fund manager on Money Makers (worth searching their library) which bought it to my attention.
It doesn't have a particularly high-yield in comparison to some other property trusts, but it has a generally good PF of European wide properties and has been a solid performer in the past.
I wasn't too impressed by its monthly report - duplication of a paragraph shows a lack of quality/focus, but I suppose I am holding it for its performance rather than its quality of PR!!
It's discount is closing slowly, but of more importance is the discounts on the individual holdings - and these are generally far wider and offer a good chance of significant improvement if the European Property market continues to improve.
I shall hold onto it, but won't expect it to be a "shoot the lights out" investment. A steady dividend payer with a reasonable chance of capital gain.
Agree with all you say Kevin- I hold as a steady performer.
Hi KevinS1.
It’s always good to see differing views, so fwiw I don’t share the enthusiasm for TR Property Investment Trust (LON:TRY) with its modest yield when there are arguably better quality choices like Aew UK Reit (LON:AEWU) and Supermarket Income REIT (LON:SUPR) available with yields exceeding 8% and with some of the Trusts in the next paragraph, on bigger discounts too. And REITS sector looks to have bottomed so good chance of useful capital gains too.
. Alternative Income REIT (LON:AIRE) Schroder Real Estate Investment Trust (LON:SREI) and Schroder European Real Estate Investment Trust (LON:SERE) also have more appeal for me. I hold all of those as well as abrdn Property Income Trust (LON:API) and Tritax EuroBox (LON:EBOX) but have never been tempted by TR Property Investment Trust (LON:TRY).
Also it was TR Property Investment Trust (LON:TRY) Management who strongly promoted a rubbish new Investment Trust a few months ago that not surprisingly failed to get sufficient support. It didn’t suggest wise or competent judgement from TR Property Investment Trust (LON:TRY) .
Below is a Times Comment article about that Trust promoted by TR Property Investment Trust (LON:TRY. What little chance it had of getting off the ground was finished for good by that article. But anyway why on earth would investors want to invest in a new REIT Investment Trust likely to start life at a small premium when quality alternatives were available on big discounts and very big dividends?
Here’s that Times comment from last May:-
“SPECIAL PROSPECTUS NEEDS PUTTING REIT.
An IPO prospectus is typically a time for full disclosure. So, you can’t help wondering if there’s not a bit missing from the 161-page missive for Special Opportunities Reit — a new property company aiming to raise £500 million from the City.
It’s the latest venture from Simon Lee, Freddie Brooks and John White, the team behind LXI Reit — the outfit sold to LondonMetric Property. Once again, Lee is in the chief executive role, with Brooks the numbers man. And, who yet knows if their Special idea will stack up.
It plans to “capitalise on the recent dislocation in UK real estate capital markets”, aiming to snap up the likes of student digs, industrial assets, data centres, retail parks and budget hotels at “bottom of the market” prices or from “distressed” sellers. Don’t lots of property companies try that sort of
Whatever, putative investors deserve to know a little bit more about the trio’s background, and notably that of Lee, than turns up in the prospectus — because all three have connections to Alvarium, the investment firm now part of US-listed AlTi Global, that brought us the scandal-plagued Home Reit.
Maybe space was tight. But you have to get to page 121 of Special’s prospectus, amid a long list of previous directorships, to find that first Lee and then the other two were all former directors of Social Housing Income Advisors (SHIA). What that? The firm that advised the Home Long Income Fund (HLIF), the private company launched by Alvarium in August 2018, two years before it brought us its public market version: the housing for the homeless basket case, Home Reit, that’s now being crawled over by regulators and sued by investors.
AlTi still owns HLIF and disclosed in its latest quarterly report that aside from its performance having “declined significantly”, the Financial Conduct Authority has since February been investigating the “historic management” of the fund — as it is also doing with Home Reit. Yes, Companies House filings show that both Lee and White quit as SHIA directors in July 2020, alongside one of the main two Alvarium investment advisers to Home Reit, Jamie Beale. Yet Brooks was listed as a SHIA director from HLIF’s launch up to January 2023.
It’s Lee’s role that is most intriguing, though. Public filings show he was head of “public real estate” at Alvarium, the owner of the firm that managed LXI. Lee has long maintained that, for legal reasons, LXI and Home Reit had to be run entirely separately. And that he had nothing to do with the (mis)management of Home Reit under Beale and its other key ex-adviser Gareth Jones: a duo who have maintained radio silence amid allegations that they bought rundown properties at inflated prices from people to whom they were connected.
Lee’s protestations don’t quite tally, though, with the view of other former senior Alvarium personnel. Last year, its former co-chairman, ex-Lazard banker Ken Costa, told The Times that Beale and Jones were “reporting to Simon Lee”, who “is the one person who could answer all your questions”.
Lee says that is wrong. So how does he explain an email he sent to “Alvarium Partners and Supervisory Board” in September 2021? There he wrote: “I’m delighted to report that Home Reit has successfully closed an over-subscribed second capital raise” — of £377 million — giving a “huge thank you and all credit due” to a team including “Jamie” and “Gareth”. He said it would “allow Home to acquire high quality accommodation for a further 4,000 homeless people”, before outlining the £10 million fees Alvarium would earn on the extra capital.
Why was he writing that email if he wasn’t involved in Home Reit? Sadly, Special’s prospectus doesn’t help answer that.”
Slightly harsh in my opinion Ken
"These include TR Property, the £1bn stocks and direct property trust run by Columbia Threadneedle’s Marcus Phayre-Mudge, and ‘other Columbia Threadneedle investments funds’ that have not been disclosed.
Columbia Threadneedle is joined by US credit investor GoldenTree Asset Management and the Bhavnani family office, linked to Ram Bhavnani, whose family made $1.2bn from the sale of its stake in Bankinter in 2007."
TRY has been around for many years- I used to deal in when I was an Investment Trust broker in the 1980's.
I like its mix of holding property funds and direct property.
Yield is not the highest, but in my opinion a good spread of risk.
I agree about the good spread of risk and TR Property Investment Trust (LON:TRY) is up 30% over 1 year which is better than a lot of alternatives. But others I hold like Alternative Income REIT (LON:AIRE) and abrdn Property Income Trust (LON:API) have done even better and their yields are much higher too. TR Property Investment Trust (LON:TRY) is not for me for reasons I posted, but there are far worse choices available too.
I hold AIRE in my wife's ISA. We bought in 2021. Dividends re-invested but share price is same as when we bought. TRY only bought Jan this year .
Wow! Great posts here on Trusts like Augmentum Fintech (LON:AUGM) and NextEnergy Solar Fund (LON:NESF. I hold both and agree with KevinS1 and John Rosier on the key investment case for NextEnergy Solar Fund (LON:NESF) and with ShoeShineBoy and Charles on Augmentum Fintech (LON:AUGM) which imo doesn’t remotely match the rubbish blue sky shares promoted so strongly on Mike Walters site. And it’s an Investment Trust which is far less risky than high risk blue sky rubbish.
It’s great that ShoeShineBoy shares his detailed research on a range of Trusts with us in posts that must take him ages to do on top of all that time researching. There’s no right way but my main focus is always on the Results and other updates for key information including checking for signs of improving or worsening performance. I place trust in the Management team who really should know more than I do, even if I research for many hours .
My conclusions on NextEnergy Solar Fund (LON:NESF) and Augmentum Fintech (LON:AUGM) are similar to those of Charles and and for NextEnergy Solar Fund (LON:NESF) Kevin and John Rosier too. So far there are no indications of a dividend cut. If that changes then is the time I would liklely sell.
As for Henderson Far East Income (LON:HFEL) that bad performance is historic. Results updates have made very clear the change of strategy and why they are confident of continuing to pay the 10% dividend and hence being a must not to miss a results updates. That’s why I hold. If performance continues to disappoint despite the strategy change, or if there is a dividend cut that’s when I sell, rather than on my hunch that it might be. I bought Temple Bar Investment Trust (LON:TMPL) a good while ago when like Henderson Far East Income (LON:HFEL) there was a change of strategy and Management after dire performance , and it has doubled. If (and for now it’s a big if) Henderson Far East Income (LON:HFEL) recovers half as well, investors holding now will have that annual 10% dividend on top of share price gains. Isn’t it better as the stock market always does, to look forward rather than back when deciding whether or not to invest?
Finally for UK smaller companies, like Charles I prefer to go,for my own choices though I do hold Strategic Equity Capital (LON:SEC) . But I agree that now looks a good time to buy UK smaller companies Trusts for hose who don’t want that single Company risk. And Jpmorgan Uk Small Cap Growth & Income (LON:JUGI) looks well worth checking out.
Hi Ken,
Thanks for your kind words, I would like to contribute more to this thread but work dictates I'm afraid.
Btw, I also did well out of Temple Bar Investment Trust (LON:TMPL). Almost certainly a copy of your trade but I sold a while ago as it is very similar to Edinburgh Investment Trust (LON:EDIN) and the latter has a very low cost loan option for when the managers want to increase gearing. I'm tempted to sell Edinburgh Investment Trust (LON:EDIN) now though and replace it with the best performing trust in the UK equity income sector, Law Debenture (LON:LWDB).
I've just updated my spreadsheet and 3 things stand out to me....
# Almost every chart looks the same for the last month with the exception of a very small legacy holding in Falcon Oil & Gas (LON:FOG) and a relatively new holding in Lloyds Banking (LON:LLPE). Even Capital Gearing Trust (LON:CGT) which sells itself on being a wealth preservation trust has the same drop and recovery! Falcon Oil & Gas (LON:FOG) has to go now, I can't have it eating up anymore dividends. And Capital Gearing Trust (LON:CGT) is not doing anything for me; I may end with egg on my face at a later date but I view it as dead money at the moment.
# I've been on holiday for a couple of weeks and therefore couldn't do anything (buy or sell) even if I wanted to. No access to my line manager or Compliance to approve trades. Reminds me of a story I heard about Sir John Templeton who moved to the Bahamas and joked how his good performance was thanks to him getting hold of the WSJ a few days later than everyone else since his office wasn’t located in Wall St. I like the comparison but mine is wishful thinking!
# My dividends are growing. As of Friday, I am at 75% of my 2023 full year total. Why oh why did I not do dividend investing from the start ?! Keeping things simple and monitoring prices week on week, thinking about whether I can replace an existing position with something better allows me to sleep at night. Better late than never.
I will revert on Augmentum Fintech (LON:AUGM) when I have listened to the MM podcast from early May again.
SSB
I listened to the Tim Levene (CEO of Augmentum Fintech (LON:AUGM) ) interview on the Money Makers podcast back in early May on my way into work today. I have to say I like this trust and it is now on my watch list. The link here is to the Annual Financial Report for the year ended 31 March 2024.
https://tinyurl.com/37b2y4d3
Podcast notes:
# TL describes Augmentum Fintech (LON:AUGM) as a venture capital fund.
# Looking to give investors diversification across financial services.
# 6 realisations in 6 years with momentum picking up recently.
# All realisations have been at above reported NAVs (approx 30% above NAV).
# A more buoyant market would mean more activity.
# 90%+ of the exits in the fintec market over the last 10 years have been acquisitions rather than IPOs.
# Lots of cash sitting on the side lines waiting to be deployed in the market.
# TL thinks that maybe there is more public to private to come ? eg: Darktrace (LON:DARK)
# Augmentum Fintech (LON:AUGM) board have approved a share buyback. SSB: this was back in Oct-22 when the board authorised a buyback of 15% of the issued share capital and there have been regular RNSs since.
# But TL would prefer to use cash in the trust to invest in new opportunities rather than buyback shares. SSB: annual results report £45m cash as of 31st May ie: approx 15% of total NAV.
# Expecting to be more active this year than last year.
# Discussion moves onto the London market in general: why do pension funds not invest more into LSE shares than gilts + abroad ? Liquidity argument again.
# TL talks about the tax benefit that UK pension funds get by investing in UK shares.
# TL spends lots of time with both institutional and retail investors. SSB: this is a bit vague but he is clearly not going to talk about why institutional investors do not want to invest more, no CEO does this.
# Lots of AI in the trust, "should have called the trust “Augmentum AI!" :-)
# More digital transformation expected, especially in Wealth Mgt as this has traditionally been driven by specific individuals and people connections.
# Best tech has remained "black box". Makes reference to a 3 hour Acquired podcast on Renaissance Technologies. SSB: LOL, I now remember this interview because I then listened to the Acquired podcast about Renaissance Technologies and wrote some notes up on it and posted them under Ken's BARG heading. Fascinating podcast about RenTech but I was still none the wiser about how they made something like 60% APR over 40 years. "Black Box" says it all!
# Back to the Augmentum Fintech (LON:AUGM). 25 companies account for 70% of the portfolio.
# One significant / exciting businesses in the portfolio is Tide Holdings which has launched first in India and then Germany. 250,000 small businesses using Tide in India.
# TL also mentions Zopa Bank and Iwoca because they are doing “exciting things”.
# Many of the businesses are based in Europe but looking to serve global markets.
A recent addition into my PF has been Jpmorgan Uk Small Cap Growth & Income (LON:JUGI)
As I move more towards IT's leaving my higher-risk investments in my SIPP I thought I'd start to have a look for some UK small/medium sized Co trusts.
I very much liked the look of Jpmorgan Uk Small Cap Growth & Income (LON:JUGI) top-10 and I think its recent performance speaks for itself.
Early days and need to do some more comparisons against other contenders, but some of my family ISA funds for this year have been put into it and I suspect this will be followed by further investments as I do more research.
Any thoughts & views.
I sold NextEnergy Solar Fund (LON:NESF) in mid-2023 when I decided I'd had enough. The dividends were good but the NAV was steadily declining and the SP was declining much faster. I couldn't see the point in holding any longer. John Rosier said something similar in his IC column a few weeks back:
NextEnergy Solar Fund (NESF) was up 12.9 per cent. It also announced a £20mn share buyback (around 4.5 per cent of its market capitalisation). On 19 June, it revealed the sale of a 35.2MW solar farm for £27mn. That was a 14 per cent premium to its holding value and added 0.57p to the net asset value (NAV) of the fund. This was a significant deal from several points of view. It demonstrated the value of its assets, it enhanced the overall NAV of the fund, and it provided cash for reinvestment, repayment of debt and share buybacks. Share buybacks make tremendous sense when the share price languishes at a 28 per cent discount to NAV. The fund also reassured about the dividend: it has committed to increasing the payout by 1 per cent to 8.43p in the current year ending March 2025. It pays quarterly dividends of £2.1075p. Even after the share price rose to 81p, it yields over 10 per cent.
What should be more good news is that it is in the process of selling three further solar farms. If it can achieve similar prices, it will enhance the NAV again and perhaps increase the buyback size. NextEnergy Solar has not been one of my better investments. Over the time I have held the shares, my total return is -2 per cent. The capital return has been abysmal but nearly cancelled out by the nine quarterly dividends I have received. I think my patience is about to pay off. If, over the next 12 months, the discount to NAV were to reduce to 10 per cent, that would give a 20 per cent capital uplift, and I would receive another 10 per cent in dividends. Why is that likely now? With interest rates and gilt yields likely to ease, the increase in the cost of capital is probably behind us. The new Labour government might also be helpful, given its commitment to decarbonising the electricity grid. Then, of course, there is also the share buyback programme.
The following doesn't read particularly well to me with borrowing as a percentage of gross assets rising to 46% and the total cost of debt at 4.5%. With these numbers, how sustainable is the 10% dividend ?
https://tinyurl.com/37cpr5ds
I prefer Greencoat UK Wind (LON:UKW) but I've yet to do any detailed research on it. The fact the discount on Greencoat UK Wind (LON:UKW) is only 10% tells me the market believes the NAV more and the dividend is more sustainable.
Any thoughts ?
SSB
Hi SSB,
I hold NextEnergy Solar Fund (LON:NESF) - had held in the past and sold out a while back, but bought back in when its SP and discount hit a recent low.
Last weeks NAV reduction was a bit of a shock and my initial thought was to sell, but taking more time to read the full update I was actually quite reassured
The recent improvement in share-price has given me confidence in the long-term direction of travel, so I remain happy to hang on. I may also top-up on any sign of weakness.
I guess this validates the idea that the various views of investors makes the market.
Best wishes.
Premier Miton Global Renewables Trust (LON:PMGR) Investor Meet Company PREMIER MITON GLOBAL RENEWABLES TRUST PLC The case for Renewable Developers 21st Aug 2024 at 10:00am .
I’ll post more on Augmentum Fintech (LON:AUGM) and a few other Trusts another time. Meanwhile Augmentum Fintech (LON:AUGM) continues to look so undervalued.
Here’s their latest factsheeet. It’s well worth reading all of it, but don’t miss page 3 to see what they paid for their top 10 investments and what they are worth now:-
https://augmentum.vc/wp-conten...
Augmentum Fintech (LON:AUGM) is trading at a 36% discount to a rising NAV. The share price will probably stay becalmed and might even drift a bit lower, until there is news to change that. The risk with staying out is a possible big one day share price gain on significant good news like a bid or other corporate action, or just an update, waking investors up to what to me looks crazy share price undervaluation.
I’ve got a full stake after buying at 85p last November and then a badly timed average up at 120p in July.
Thanks for posting Ken. I meant to have a look at Augmentum Fintech (LON:AUGM) after you posted on it the last time but I never got round to it. AIC web site says there are 2 trusts in the Financials Sector and I posted on Polar Capital Global Financials Trust (LON:PCFT) when they presented at Mello. However, they are quite different trusts in terms of mkt cap, yield, discount and top 10 holdings. Polar Capital Global Financials Trust (LON:PCFT) holds a lot of the established US banks that are well capitalised post GFC and pay decent dividends. The trust trades at a 7% discount to NAV and the yield is almost 3% so robust but nothing too exciting.
Augmentum Fintech (LON:AUGM) is half the size in terms of mkt cap and holds much newer stage financial companies. Top 10 accounts for 75% of the total trust so very concentrated. Looking at the factsheet, these companies are almost all based in Europe, mainly London. So this is not a global trust. It's a European private equity trust investing in fintech companies (ie: the use of technology to deliver financial services and products to customers, various documents mention the increasing use of AI to do this). No gearing and no dividend so that is straightforward.
As you say, the attraction is the discount. It widened in early 2022 with the SP declining off a steadily increasing NAV. So presumably, it's similar to a lot of other growth trusts where future flows of income are worth less as they are being calculated using a higher discount rate.
The Factsheet says most of the holdings are involved in Digital Banking & Lending and payments. Very little in insurance which I think is wise because the European insurance sector has some really strong companies who it will not be easy to take market share from.
The Factsheet is helpful but the interim accounts ending 30 September 2023 give a much better understanding of the trust....
https://augmentum.vc/investors...
It explains the trust is "focusing on the fintech sector, having launched on the main market of the London Stock Exchange in 2018, giving businesses access to patient funding and support, unrestricted by conventional fund timelines. We invest in early and later stage fast growing fintech businesses that are disrupting and accelerating innovation in the banking, insurance, asset management and wider financial services sectors. We have invested in many great businesses and have secured five exits since IPO, the most significant of which, Dext, interactive investor and Cushon, were strongly accretive".
And it also explains how real these businesses are: "The Company’s portfolio stands at 24 fintech companies, with diversification across fintech verticals, European markets, and maturity stages, as we told investors we would build during the Company’s IPO. Since listing, we have delivered £84 million in realisations, across five exits and from dividends, despite the macroeconomic backdrop. The portfolio’s top 10 companies employ over 4,000 people and generate close to £1 billion in annual revenues, with year-on-year growth continuing at an average of 74%. Four of this group are profitable and the remaining six have an average cash runway to their next funding round of 29 months".
The NAV is valued every 6 months and with only 24 holdings, it should be reasonably straightforward to value. Sure there are some key underlying assumptions but Augmentum Fintech (LON:AUGM) is more like HgCapital Trust (LON:HGT) than say Harbourvest Global Private Equity (LON:HVPE) ie: fewer holdings. What is not clear to me is whether Augmentum Fintech (LON:AUGM) owns 100% of each of the 24 holdings. I think the answer is yes but I'm not 100% certain. The interim reports says "Each position is valued objectively using the most appropriate methodology. 92% of the portfolio is valued using public market comparables. Wider governance is a key element of the process with each valuation signed off by the Board and Valuations Committee. Over time we have demonstrated consistency and prudence in our approach, protecting the valuations from some of the outsized market swings that were seen in 2021 and 2022".
As you say Ken, Augmentum Fintech (LON:AUGM) have realised higher sale proceeds on sale of these holdings than the latest published valuations. A deterioration in the global economy would of course damage this thinking but then that goes for most businesses.
Augmentum Fintech (LON:AUGM) is similar to HgCapital Trust (LON:HGT) in that it invests in a small number of businesses which it is actively working on to sell onto third parties. It is different to HgCapital Trust (LON:HGT) in that is doesn't have much history, it's launch date was only 2018. But overall I like it and I'm tempted.
Apologies for the above "Janet and John" approach but I wanted to make sure I understood the trust and the key thing for me is that it is a private equity trust in all but name so we have to keep on asking how realistic and achievable the NAV is. If the trust keeps selling assets at prices greater than the latest valuations, then the answer should be that we can believe the NAV. It's then a case of whether there is enough demand for the shares to close the discount. Lack of institutional buying because of it's size may be a problem here, how much I'm not sure.
Hi Ken & SSB,
I've been in & out of Augmentum Fintech (LON:AUGM) but have come to the conclusion that it is too high risk for me - there are so many companies that are "jam tomorrow" and it doesn't have the pedigree of some of the other early stage/PE funds & trusts that are out there with very solid track records.
I recognise I risk losing out on a huge winner (should one rip to the top), but I am unsure of what the catalyst is for the trust to suddenly have such a winner. I've invested in too many blue-sky/jam tomorrow stocks in the past and as I get older my risk tolerance is beginning to wain.
Good luck and I hope you get the returns, but its one I shall sit out of.
Hi Kevin,
I hear what you are saying re: blue sky shares, especially if you were on the Mike Walters board. So many pre-revenue dud shares that would briefly do well and then flop. But I don't think Augmentum Fintech (LON:AUGM) can be classified as blue sky. I did wonder about this myself but then came across the following paragraph from the interim report:
"The Company’s portfolio stands at 24 fintech companies, with diversification across fintech verticals, European markets, and maturity stages, as we told investors we would build during the Company’s IPO. Since listing, we have delivered £84 million in realisations, across five exits and from dividends, despite the macroeconomic backdrop. The portfolio’s top 10 companies employ over 4,000 people and generate close to £1 billion in annual revenues, with year-on-year growth continuing at an average of 74%. Four of this group are profitable and the remaining six have an average cash runway to their next funding round of 29 months".
And this is why I compared it to HgCapital Trust (LON:HGT). Both trusts are essentially private equity trusts, just in different sectors. However, the difference between the 2 is that HgCapital Trust (LON:HGT) has a mkt cap of £2.4bn whilst Augmentum Fintech (LON:AUGM) has a mkt cap of only £183m and I just wonder whether there is enough institutional interest in the latter. But I am tempted and thanks again to Ken for posting on it.
I am going to listen to the interview with Tim Levene, CEO of Augmentum Fintech (LON:AUGM) from the MM podcast back in early May. I listened to it before but I don't recall many details so no harm in listening again, maybe I will answer some of my own questions.
https://tinyurl.com/2usyabpn
Good to hear you've done well out of Jpmorgan Uk Small Cap Growth & Income (LON:JUGI) . UK Small Caps is a positive sector at the moment. I bought Aberforth Smaller Companies Trust (LON:ASL) a little while back and I'm reasonably happy so far.
The sector for trusts with a mkt cap >100m looks like this. Ordered by 10 year annualised gains. A lot of gains over 1 year but some differences over 10 (as you would expect).
I hope NextEnergy Solar Fund (LON:NESF) does well for you but we will have to disagree on that one. The sector is plagued at the moment by trusts selling assets to raise cash and reduce debt. This week's MM podcast talked about JLEN Environmental Assets (LON:JLEN) selling a couple of assets to do just this. I'm interested in Greencoat UK Wind (LON:UKW) because it is one of the largest trusts in the sector and pays a 7% dividend. But I'm wary of anything that pays a decent dividend only to see that income eroded by losses from a declining share price, there is no point in that. May as well buy a gilt. I will come back on Greencoat UK Wind (LON:UKW) when I have had some time to understand it.
SSB
SSB I hold AUGM, and have for several years. The financial sector is still ripe for disruptors to make a significant impact . At some stage the NAV performance will improve sharply and discount reduce-in my opinion. I tend to use trusts for overseas exposure or specialist sector exposure so tend not to but Trusts invested in smaller companies- do that myself.
Scottish Mortgage Investment Trust (LON:SMT) Save your spot here https://info.bailliegifford.co...
You are invited to the inaugural Scottish Mortgage Digital Conference, 30 September, 1-3pm. The theme is Change Drives Growth.
At Scottish Mortgage, we aim to find and support the world’s most exceptional growth companies. In our experience, these tend to be companies redefining the industries in which they operate. By offering something new and better, they can rapidly take market share from existing players.
Scottish Mortgage aims to include these disruptors in the portfolio so shareholders can benefit from any returns they may generate. In short, change drives growth.
To bring this concept to life, we have an exciting line up of speakers:
I recall Tom Slater speaking at the AIC Conference last year. It was almost evangelical! I keep thinking about buying a small stake in Scottish Mortgage Investment Trust (LON:SMT). Maybe I should sell the underperforming stake I have in Capital Gearing Trust (LON:CGT) and put the proceeds into Scottish Mortgage Investment Trust (LON:SMT) for a long-term punt. Interest rates should come down to circa 4% (ish) in the US and UK plus the private equity holdings are revalued every quarter. It's been a roller coaster ride over the last 5 years!
Jpmorgan Asia Growth & Income (LON:JAGI) are one of 3 companies presenting at the AJ Bell Shares meeting 18:00 Tuesday 3rd September. "JP Morgan Asia Growth & Income (JAGI) provides access to the Asian equity market and targets predictable quarterly income without compromising its focus on growth. Managed by a locally based team of investment experts to provide access to Asia’s fast growing markets and benefits from our long experience in the region."
Register here
Thanks for posting on a regular basis Charles. It encourages me to look at my current holdings and think about whether I would replace any of them with something else in a particular sector. I hold Schroder Oriental Income Fund (LON:SOI) from the Asia Pacific Income Sector. A small capital gain over the last 12 months or so. The dividend is solid.
The Jpmorgan Asia Growth & Income (LON:JAGI) dividend looks like it is either paid out of current year's available income only or out of capital. I have lost track of Henderson Far East Income (LON:HFEL) but I still don't understand how it can offer a yield of 10%! Maybe just a lack of understanding on my part but I sold a while ago and bought into SOI as, hopefully, a safer bet. Right click and open image in new tab to see the detail below from the AIC web site.
ShoeShine, HFEL had a big portfolio reorganisation 12 months or so ago following a period of underperformance. They get a decent income from the underlying portfolio and have reserves the board have stated they will use to maintain dividend if required. This webinar should help https://www.janushenderson.com...
Yes, I recall that now. Thanks Charles. But I'm still not sure about Henderson Far East Income (LON:HFEL) . It does seem less volatile in the last 12 months but I can't get away from the steady decline in the SP over the last few years. I'm relatively happy with Schroder Oriental Income Fund (LON:SOI) so it's a watch & wait from me I think.
Still watching Macau Property Opportunities Fund (LON:MPO) which is winding down, but avoided buying yet- just as well as NAV declined 12.3% quater ending June 30th. Looks messy in Macau " As prefaced in the latest investor update, local developers have recently embarked on a series of heavily discounted sales of inventory properties, in order to raise cashflow, which has impacted market values in the near term. The Manager continues to achieve carefully targeted sales against this challenging backdrop. Following the successful reduction of debt levels, the Company continues to comply with all banking covenants and Loan to Value ratios."
There will be an opportunity to buy, but I suspect not in the short term.
I'm catching up on a number of RNS / updates that I previously hadn't had time to read. One or two things come to mind....
I was thinking of buying some Renewables Infrastructure (LON:TRIG), purely on the discount to NAV and the 7% yield but the following put me off:
"As a result of power generation falling 7% below budget and TRIG’s focus on debt reduction, distributable cash flows declined from £145.2m 12 months ago to £99.9m at 30 June. This covered £91m of first-half dividends by just 1.1 times compared to 1.7 times a year ago".I will monitor instead and see if the NAV and SP fall further. Anyone feel differently ie: maybe this is the bottom for TRIG and things will get better ?
https://tinyurl.com/25kv7nsz
Again, I was thinking of increasing my investment in VietNam Holding (LON:VNH) and the latest monthly update is positive (they always seem to be positive!). VietNam Holding (LON:VNH) is the best performing trust over almost all timescales for both share price and NAV. But the discount has widened to almost 8% and I notice the trust is 9% down over the last month and 4% down over the last 3 months. Not massive movements but an opportunity to up my stake. I don't think the market 100% trusts the private equity valuations for VinaCapital Vietnam Opportunity Fund (LON:VOF), it's odd how the discount to NAV is just not closing. And someone pointed out how Vietnam Enterprise Investments (LON:VEIL) got smashed a couple of weeks back, the performance of that trust looks poor now, especially as they don't pay a dividend to make up any of the SP drops.
https://tinyurl.com/bdmujtnp
The AVI Japan Opportunity Trust (LON:AJOT) July update includes the following:
"Some Japanese domestic capital is being repatriated back to Japan whilst foreign capital that flowed into Japanese equities over the past 12-18 months is flowing in the opposite direction. Much of that capital fuelled a rally in large-cap Japanese names. We have argued for a while that there was far greater value in the small-cap universe, particularly so amongst companies largely exposed to the domestic economy and thus relatively immune from moves in the Yen and fears over a global slowdown. This is still very much the case. Panic selling and a sharp decline in share prices have historically proven to be good opportunities for our style of investing. We hope to be able to provide further detail on this as the effects become clearer, but for now we remain optimistic about the prospects of our portfolio and the impact our engagement is having".
I'm tempted but AVI Global Trust (LON:AGT) already has a Japanese element to it and again that element is mainly small cap so I will stick with that.
https://tinyurl.com/4supbmj7
The AVI Global Trust (LON:AGT) July update actually explains the Japan unwind better I think. I would definitely like to add more to my position but I am out of the office with no access to either Compliance or my account! Oh well, another door will open in time.
"Over the last few trading days, we have seen considerable volatility in global equity and currency markets. In Japan, the Yen has moved from a near 40-year low against the dollar of 162 to 143 at the time of writing (5th August). In turn Japanese equities have been hit very hard by indiscriminate selling, with the TOPIX having fallen more than -20% in very short order. There are clear signs of panic selling and unwinding of leveraged positions, but the ongoing rally in Yen and heightened levels of risk aversion could extend the panic to other areas of the market – particularly where assets are excessively priced. History tells us that as uncomfortable as such environments are whilst they play out, they also present highly attractive opportunities at prices few imagined possible just a few weeks ago. We have been adding to several positions".
https://tinyurl.com/5n6ujm7c
I have several interims to read and will post more if relevant.
Last thought for tonight: UK inflation is expected to tick higher when it is reported on Wednesday. Interest rates are likely to stay higher for longer as a result. Could be a good day for some investors on this site to top-up ?
SSB
For holders of Trusts investing in India see image for effect of new capital gains tax on NAV- From latest report by India Capital Growth Fund (LON:IGC) I hold this and Ashoka India Equity Investment Trust (LON:AIE) .
I have been a shareholder in Hydrogenone Capital Growth (LON:HGEN) for a few years, so showing a largish loss. I know many think Green Hydrogen is not viable, so interesting to read this from InvestChile (The Chile Government Foreign Investment promotion body). https://3222615.fs1.hubspotuse...
Bayer AG is big on the green hydrogen thing if their website is accurate. I think it depends a lot on the political environment...... so who knows!
Dunedin Enterprise Investment Trust (LON:DNE)(I hold) Latest NAV declared (June 30th 2024) was 627.60 a slight increase on the March 31st NAV. Share price 517.40. So there is a discount of 17% or so.
"Dunedin Enterprise Investment Trust PLC has announced details of a proposed liquidation. Liquidation is the process of bringing a business to an end and distributing its assets to claimants.
Realisation of EV Holdings Limited ("EV")
Dunedin Enterprise Investment Trust PLC is pleased to announce that Dunedin Buyout Fund III LP has entered into a legally binding agreement for the realisation of its investment in EV, a provider of high-performance video cameras and quantitative visual analytics to the global energy industry.
The investment in EV was valued, net of carried interest, at £2.6m at 30 June 2024. Proceeds from the sale will amount to £2.6m, consisting entirely of capital.
The transaction is subject to regulatory approval and is expected to complete by the end of 2024.
Following completion of the EV realisation the Board intends to send shareholders a proposal for a members' voluntary liquidation of the Company as envisaged in the Chairman's Statement published in March.
Investors will get their cash but I cannot help thinking the buyers will do better.
I understand the discount thing but the big advantage of investment trusts was supposed to be their ability to ride out downturns. Not to be forced to liquidate all or part of their holdings!!!!
Investor Meet Company this coming week Global Smaller Companies Trust (LON:GSCT) Aug 13th 12.00
For investors looking at Japan here is the performance of the 7 main Indices. There are ETF's that follow these here.
Are these ETF returns in GBP? If so Investment Trusts specialising in Japan are very poor value in the main:
For large/mid https://www.theaic.co.uk/inves...
For small caphttps://www.theaic.co.uk/inves...
Sadly I hold Baillie Gifford Japan Trust (LON:BGFD) which has been a very poor performer. To make matters worse I also hold a OEIC/fund with Baillie Gifford and that is even worse!! Japan has been a graveyard for me - never made any money in collective investments of whatever type over the last 25 years. Probably should have saved myself the effort and bought ETFs!!
Currency movements have been an issue.
Tufton Oceanic Assets (LON:SHIP) Citywire article https://citywire.com/investmen...
I bought some Tufton Oceanic Assets (LON:SHIP) a couple of weeks ago, as good divi and returning capital soon, but got a bit done over by ii on the FX rate to USD (which dampened the enthusiasm somewhat!).
Tim- Brokers can do this- not used ii so no experience.
Tim - There is a LSE quote in £ Tufton Oceanic Assets (LON:SHPP) . Also II let you keep US $ on account so if you trade the US market you only have to pay FX once ( or twice if you cash out back into£).
Bah, kicking myself for only looking for SHIP (which is also LSE listed, but in USD). Looking for the silver lining here the FX rate I paid has boosted Abrdn (LON:ABDN) earnings!
Good monthly summary on investment trusts. Private Equity, UK small caps & the Resource sector all covered. I listened on my iPhone but podcast is also available on the Kepler web site.
SSB
—————-
Monthly round-up of investment trust news
Kepler Trust Intelligence Podcast
Jo Groves and Ryan Lightfoot-Aminoff from Kepler Trust Intelligence discuss the most notable news, reviews and interviews in the investment trust world in July. We discuss how the sale of one of Hg Capital’s holdings could be a positive sign for the private equity sector and what implications the biggest one-day gains in US small companies’ history could have on the asset class. We also bring you the highlights from the second round of our small-cap webinar series with Gabriel Sacks, manager of abrdn Asia Focus, Robin West, manager of Invesco Perpetual UK Smaller Companies and, finally, Christopher Berrier of Brown Advisory US Smaller Companies. We round things off with the key talking points from our recent interview with Olivia Markham, manager of BlackRock World Mining. 0:00 Welcome 0:18 Hg Capital disposal 02:43 Sale of Graphcore 05:34 Performance of US small-cap equities 06:59 Small-cap event round-up 07:25 abrdn Asia Focus 10:31 Invesco Perpetual UK Smaller Companies 13:55 Brown Advisory US Smaller Companies 16:28 Interview with Olivia Markham, BlackRock World Mining 20:11 Risk warning
Listen on Apple Podcasts: https://podcasts.apple.com/gb/podcast/kepler-trust-intelligence-podcast/id1628343255?i=1000664607725
See this from Trustnet
Triple threat trusts, delivering income, performance and diversification.
Been buying some LONTarget Healthcare Reit (LON:THRL) for anyone who doesn’t know it is a reit that owns retirement homes that are let out to companies that run them the leases are long term average around 25 years after falling back from over a 100 it has settled in the high70s to low 80s
Has a solid divi of around 7%
After some reorganisation and sale of some assets to bring down debt and cutting the divi so that it is covered by earnings think the trust is in a very good position
In 2030 care homes are will have to be rated at A or B Energy rating 99% of targets homes are at this rating a large proportion of car homes in uk are below this targets homes are purpose built modern with wash rooms rather than converted from buildings whose I tail use was different
https://www.ashfords.co.uk/ins...
Here is latest update from LONTarget Healthcare Reit (LON:THRL)
https://newsfile.refinitiv.com...
For those looking for a good long term dividend trust which is on a discount of around 25% it’s in a good area one thing there won’t be a shortage of in future is older people in need of care
It could be worth a look
Sorry if this trust has been written up before
Thanks Bullhead, Not a trust I have looked at- the yield looks good for my wife's ISA. Charles
Your welcome
Pleased you found post useful
I bought Impact Healthcare REIT (LON:IHR) instead-slightly higher yield.
I also hold Impact Healthcare REIT (LON:IHR) but have you seen this ludicrous reason for them having to change their name in the next few months: https://citywire.com/investmen...
Seriously is this what the FCA employees spend their day doing. Not exactly productive is it? I would rather they focus on preventing fraud such as the one perpetrated at Patisseie Valerie where the Directors still seem to be enjoying their ill gotten gains!! Truly pathetic bureaucracy- any wonder productivity in the country is so appalling!
I am not sure what you mean by Patisserie Valerie- if you mean Luke J he lost a shed load of money.
See Oakley Capital Investments (LON:OCI) is down 5%- not sure why- buying opportunity though will see what markets do overnight. Seraphim Space Investment Trust (LON:SSIT) down below 60p. Small holding for me but might top up at this level. Ken mentioned Augmentum Fintech (LON:AUGM) already. A riser today was Dunedin Enterprise Investment Trust (LON:DNE) -one of the stocks being realised. Looks like it will be wound up by year end, still trading at a biggish discount. Another one maybe to buy.
Top of my watchlist is Jpmorgan Global Growth & Income (LON:JGGI)
On my list-did hold but sold it in my clear out.
Charles
I’ve spent the last couple of years switching to a portfolio (often to big dividend paying shares and Investment Trusts) that I hope can ride out the really bad spells. But the key reason was to have a portfolio that can run itself in the event of my demise . i.e so that my wife is left with a worry free portfolio (except for corporate actions that need decisions) and meaning all she otherwise needs to do is to take out some or all of the substantial income that accrues from dividends, from time to time.
Today and further potentially big market falls ahead are going to be an informative test of this approach!
I haven’t sold anything this morning as I’m happy with all the holdings and don’t regret not selling last week when there were growing signs of a big market correction. (I would have sold tech dominated Scottish Mortgage Investment Trust (LON:SMT) and Allianz Technology Trust (LON:ATT) if I had held them, but the key reason I didn’t hold was that they didn’t fit the risk profile of a supposedly worry free portfolio).
As for new Investment Trust buys, is it best to let the dust settle? Or if worried about missing an already potentially good buy opportunity like Japan Trusts, then only buy part stakes now?
We can never forecast markets. This might be the start of another bear market or there could be a big bounce very soon. If there are further falls to come we’ll be pleased we waited. If there’s an immediate bounce then surely most readers and contributors to this thread already hold shares and Investment Trusts that will benefit?
I’ll come back another time with a post on tempting Investment Trust buys in case it’s of interest to anyone.
Right now Is the further fall for Augmentum Fintech (LON:AUGM) a remarkable buy opportunity. The strong investment case has been posted before.
And note how so far in this market fall the Trusts paying very big dividends are holding up well and in a few cases are even up a bit.
Thoughts on any of this anyone?
Ken, I am not sure what is going to happen. I now have a pile. of cash and will buy- when is the question. Agree re AUGM- I may buy more though it is already one of my larger holdings. I just wonder now if markets are going to be very nervy until elections- and especially USA are past. It does sometimes make you wonder about active managers- did none of them see this coming and get slightly de-geared/liquid ? It is their job - we are all just part time investors-I assume ?
Good post. We have had a horrid few days on the market. I don't think the selloff will last too long and the fact that we are in an environment of lowering interest rates should help, although an emergency cut in the states might be seen as a bad signal.. I hold Augmentum Fintech (LON:AUGM) but wouldn't buy more at the moment because they are technology and therefore linked to the tech stocks in the US (although not when US tech stocks are increasing!!) - last time the market had a big fall I bought things with high, covered dividends such as Aviva (LON:AV.) M&G (LON:MNG), abrdn Equity Income Trust (LON:AEI) and many more, as well as bond trusts such as Twentyfour Select Monthly Income Fund (LON:SMIF) - bonds should do well with the interest rate cuts? It feels like there is a lot of fear out there and my portfolio has been smashed! Good to chat and come up with opportunities with like minded investors.
This post strikes a great chord for me. I too have done a very similar project exactly as Ken has done, which I started 2 years ago before I was 'lucky' enough to come across this thread that I now follow every day alongside the small cap reports of Paul and Graham. Recent days volatility have not been concerning as I bought the income stream which remains strong and growing. Using the AIC website information which has been brilliant at assisting decisions, I have a 13 strong IT portfolio targeting Quarterly Dividends spread over the 12 month period. The investments are held within ISA structures which protects dividend income and the potential of useable income for my wife , should I no be around, to benefit from. The spread of the investments mean that as I have checked this morning, I am still showing a small higher capital return than the purchases. Importantly though, the Dividends arrive in a clockwork fashion. They are currently reinvested across the portfolio, not using DRIP, but selectively. So for example, I am now building a position in Impact Healthcare REIT (LON:IHR) .
That was a very interesting post Roy and it’s good to read that your tactics are working well. Depending on what Investment Trusts you hold surely there’s a good chance of useful capital gains to come too?
Your approach and mine should ensure we can ride out bear markets and watch the regular income flow in. The only exceptions I can think of (if there are others please post) would be another severe pandemic and even worse than covid. Aside from the huge death toll it would not be possible for Governments to support business to get through it like they did with covid. So even solid dividend paying shares would take a hit and with those previously safe and rising dividends getting cancelled. Share prices worldwide would suffer massive falls.
The other scenario would be a nuclear war/world war3. With that our portfolios would be irrelevant. Too few these days including the politicians seem to realise that the devastating nuclear bombs dropped on Hiroshima and Nagasaki were small compared with the stockpiles of even more devastating bombs now. So nuclear war, if humans are that stupid, really would be Armageddon.
I have sold my holdings in Vietnam, india, Asia, Tech and global funds. It is looking very messy globally at the moment. Work up thinking of black Monday in 1987- and this time I will not rush to buy back in. I might well be wrong but wanted to lock in gains, took the odd small loss. I remain invested in builders, yield stocks and property . Kept BlackRock World Mining Trust (LON:BRWM).
Ken, Charles,
what are your best Japanese trusts thoughts atm? I feel a big sell off here could produce some interesting buying opportunities. Also maybe Vietnam as well? I know you have sold out Charles. But the question is whether to stay with Vietnam for the moment or sell out and buy back cheaper later?
All thoughts welcome………..?
Graham.
Graham, I am watching at moment. I will nuy VietNam Holding (LON:VNH) and VinaCapital Vietnam Opportunity Fund (LON:VOF) when conditions settle. I may of sold too late, but having watched these markets for a few years they can move down sharply once they start. Japan I wqill buy back Nippon Active Value Fund (LON:NAVF) and CC Japan Income and Growth Trust (LON:CCJI) at come stage. India Ashoka India Equity Investment Trust (LON:AIE) and India Capital Growth Fund (LON:IGC) . Done well over the years with these but I am nervous how the relatively new local. private investors will react.
Graham - for Japan I have set up 2 alerts > and < than WisdomTree Japan Equity UCITS ETF JPY Acc (LON:DXJP) . Helps monitor the market , although Nippon Active Value Fund (LON:NAVF) is very specialist so could behave differently. Done same for India and Vietnam.
Thanks Charles,
I’m away in the New Forest atm with limited internet so will look at doing this when I get back. But in the meantime thanks All for the comments and replies.
One thing with being away is I’ve not bought, sold or PANICKED!
Would be interested in more large paying dividend ideas Ken, especially a Japanese trust if there’s a good bottom feeding chance.
Thanks again, Graham.
Hi Graham, I have bought a bit back into Japan. Currency strength remains a longer term concern for exporters, but hopefully the managers will look. after the portfolio. CC Japan Income and Growth Trust (LON:CCJI) and Nippon Active Value Fund (LON:NAVF) .
It took me half an hour to find the post below thanks to the so user unfriendly Stockopedia storage etc of past bb posts. Anyway below is that post.
So for Spender71 and anyone not familiar about this nonsense of online brokers restricting the buying of certain Investment Trusts, here’s an article about it from Citywire which includes the involvement of the AIC (the Trade Body for Investment Trusts in trying to stop their nonsense:-
Here’s the Citywire article:-
AIC lobbying against ‘frustrating’ platform buying restrictions
The Association of Investment Companies says it will challenge brokers to explain why they are stopping online trading in investment firms deemed not to be ‘fair value’ or ‘complex’.
BYJAMIE COLVINTwitterFacebookLinkedinWhatsAppprintcomments9
The Association of Investment Companies (AIC) has expressed its frustration at share-dealing platforms restricting the buying of certain investment trusts and said it will lobby against them.
Last week, AJ Bell confirmed Bluefield Solar Income (BSIF) and Chrysalis Investments(CHRY) were among listed funds that failed ‘fair value’ tests which meant DIY investors were prevented from online trading in them, although they could phone through dealing instructions.
This follows similar moves by rival brokers Hargreaves Lansdown, Fidelity and Interactive Investors who have restricted trading in investment companies on grounds of either value or complexity.
Hargreaves Lansdown, for example, has also stopped investors from buying investment companies such as Digital 9 Infrastructure, Cordiant Digital and Amedeo Air Four Plus until they pass a questionnaire showing they understand ‘complex investments’.
AIC communications director Annabel Brodie-Smith said the restrictions were ‘disappointing’ because platforms did not explain the rationale behind their decisions.
‘It’s hard to see how restricting consumer choice like this could be helpful for consumers,’ Brodie-Smith said. ‘Surely, it’s up to investors to do their own research and then decide which companies they want to invest in.’
Under the Financial Conduct Authority’s consumer duty regulation, share-dealing platforms are required to alert customers at risk of poor returns and help them make informed decisions.
Brodie-Smith said the upcoming statutory instrument to reverse the Markets in Financial Instruments Directive (Mifid) may only provide the FCA with the powers to repeal misleading cost disclosure rules. These have been the subject of a separate campaign against investment companies being required to ‘double-count’ some of their costs.
Aspects of product governance, such as borrowing, liquidity and performance may be the result of rules restricting the use of ‘complex’ investments, although the AIC has always argued that investment companies should not be categorised as such, Brodie-Smith said.
‘However, we have argued in the past for these rules to be changed and we will most definitely be firmly lobbying on this issue again,’ she said.
Investors are furious at what they see as platforms’ heavy-handed implementation of consumer duty regulation, which they say will let them buy risky AIM-listed companies without warnings, but require them to correctly answer a questionnaire to invest in some closed-end funds.
‘You can buy a piece of absolute dross on AIM but you can’t buy Bluefield Solar with its government-backed stable revenues and healthy income cover? Utter nonsense,’ one commenter wrote.
‘For pity’s sake, buying a solid trust on a discount to NAV is better value, other things equal, because it’s boosting your likely forward return. This is the one that’s important, not the historic return that’s been influenced by gapping out from the net asset value.’
A Citywire forum on investment company regulation begun by Tom Poynton of wealth manager Baron & Grant received support. One investor was astonished that nothing had been done to stop the ‘dual harms’ inflicted on the UK and investors from ‘nonsensical and unnecessary Fair Value Assessments’ and the ‘very unfair depiction’ of investment company costs.
‘Why are the FCA and the City minister/Treasury just sitting on their hands and watching the situation worsen by the day?’ the investor wrote. ‘These are not particularly difficult problems to fix and action is needed ASAP.’
I find it more and more frustrating that the institutions that comprise the "City of London" advertise and promote the view that private investors are morons. They have to be protected poor things.
To get on Research Tree I have to fill in a form stating I have loads of money invested and that basically I'm a financial professional - presumably if I can't do that then I can't get access to research (to help me pick shares/investments myself) and I need someone to hold my hand and charge me an exorbitant fee.
The powers that be are comfortable that the only qualification I need to put my entire wealth on red in a London casino is the ability to breath - but if I want to run my own portfolio I need massive qualifications.
I had to fill in a form to satisfy ii when I wanted to invest in Amedeo Air Four Plus (LON:AA4) - presumably because they felt it was high risk - and I did and I invested. BUT the thing that gets me is it's no higher risk than a lot of things I invest in. I know there is large risk around the planes residual value - but this is no different, for example, to investing in a small cap. focused IT - but obviously ii considers airplane residual values risk massive compared to blue sky AIM stocks.
This is one of the myriad reasons why the London market is withering on the vine.
Rant over.
Edit: DON'T TELL ME WHAT I CAN AND CANNOT DO WHEN YOU DON'T KNOW ME.
Rant over.
A.
Thanks for posting that Ken I totally agree with your and the views in the article
Investor meet companies - Trusts meetings this week. Schroder Real Estate Investment Trust (LON:SREI) August 6th 2024.Renewables Infrastructure (LON:TRIG) August 9th 224 at 13.00 pm.
Interesting for me Zotefoams (LON:ZTF) have a meeting on6th August 2024 at 13.30 pm. One of my major equity holdings- if the new container they have developed succeeds who knows what could happen. They have a tetra pac replacement which can be recycled .
Hi Ken / All,
Responding on your post last Sunday under the July thread. Apologies for the lateness, work is keeping me busy and I find myself in constant "catch-up mode" as far as the investment trust boards are concerned. Someone needs to slow time down fella, it's simply going too fast! Having said that, I'm still enjoying the discussions, lots of good posters here.
My post on the Edmund Shing thread was a bit of a one-off. Having stopped my IC subscription recently ( the only columns I was really enjoying were by John Rosier and BearBull), my source of investment reading is now focused on RNS emails, Stockopedia and free stuff like CityWire. And then because I do a lot of walking around London, I listen to podcasts: MoneyMakers, Interactive Investor, Paul Scott, Paul Hill, Merryn Somerset-Webb on Bloomberg and of course Edmund Shing from BNP Paribas. And bizarrely, the free weekly offering from the IC! It's enough to keep me going. Plus I keep re-visiting The Investment Trust Handbook 2024 which is excellent if you like investing in long-term themes.
My account is doing well this year, I was up +8% year to date as of last week but today may have reduced that. Big holdings in Aviva (LON:AV.), Edinburgh Investment Trust (LON:EDIN) and Tesco (LON:TSCO) have been the main contributors whilst Primary Health Properties (LON:PHP) has been the main detractor. Legal & General (LON:LGEN) has been a disappointment so far this year. Lower interest rates will not suit AV. and LGEN with high defined benefit liabilities to pay out so worth watching. But then again, interest rates won't come all the way down again. Other posters will have done a lot better than me (and good luck to those folks) but I'm happy to slowly increase my account. My largest position is a gilt (approx 4.25% APR) and a little annoyingly I still have some cash. I should be fully invested but I stupidly thought M&G (LON:MNG) and Record (LON:REC) would go a little lower but the next time I looked, both had taken off again!
The 2 thoughts that constantly stay with me are: 1.) Always buy quality. Never buy rubbish, no matter what event you think is coming up that they market may or may not recognise. If rubbish gets smashed, it goes down and stays down. And 2.) The impact of dividends over time is huge. 27% of my gains this year is due to dividends. Having that stream of income and slowly re-investing it back into quality holdings, it's a thing of beauty :-)
Anyway, a few unrelated thoughts from me....
# I bought HgCapital Trust (LON:HGT) late last year back at the start of the year when the trust was on a 15% discount to NAV. It had previously traded around NAV. Andrew McHattie said on the MM podcast he liked the look of it as a long term investment. It focuses on back office software that companies need to run even if trading isn't going well eg: legal, accounting, HR, compliance, risk mgt etc. I bought a half trade which annoyed me later as I thought I should have filled my boots. Then on Monday, HgCapital Trust (LON:HGT) released an RNS saying the NAV is 524 pence per share when the share price on Monday was 519 pence. So the trust is back up at NAV. And then today it got 'smashed' by 6% in the sell-off. Would be a good time to top-up maybe. https://tinyurl.com/mrvb7fkm
# My holding of BlackRock World Mining Trust (LON:BRWM) is standing at a small loss again! But the dividends have been healthy and they keep coming. Copper is down 20% over the last 2 months but again, maybe a good time to add. The only way the world will get away from increased use of copper is to either ignore climate change or increase the amount of re-cycling that is currently happening. The following is quite good. 2 private investors discussing the copper market. Listen from 6 minutes. China still appears to have big stockpiles of copper. https://tinyurl.com/ybjpejuc
# Pref shares have done well this week as interest rates have been cut. I hold a couple myself and along with Tesco (LON:TSCO), they have acted as a good hedge. I guess the thinking on pref shares is they are actually a debt instrument and are benefitting from lower interest rates. Thoughts welcome.
# I disagree with Charles on Gordon Brown but let's park that as no one here can influence the macro outlook. What I do now agree with Charles on is Capital Gearing Trust (LON:CGT)! I hold a small position at a small loss. I bought it because I thought it fitted into a high quality group of trusts that I hold. And Peter Spiller has had only 2 (I think) down years in 40+ years which is remarkable. But I may as well sell because it has done nothing. At least I would get a decent yield on a solid REIT.
# Ken, I notice that your old favourites, Marks and Spencer (LON:MKS) and Rolls-Royce Holdings (LON:RR.) keep going up. The former looks reasonably priced and the shopping experience there compared with 3 or so years ago is like chalk and cheese.
SSB
SSB,
Thanks for your thoughts and prognosis again. Always look forward to reading your style of investing, which always seems to be well researched, steady and only investing in quality and with a strong view of the long term. Which often does well. Dividends are such an important necessity when investing in a stock for the long term as that’s when the compounding element really takes hold. It’s also an insurance, while you wait, if you get the timing slightly wrong.
A thought on your notes above; would it be good strategy for your particular style of investing and taking into consideration your employment constraints on buying and selling, that you build into your good idea positions more, so that you don’t miss those early gains? Especially when you’re sitting on the fence. It’s something that I’ve not really done myself but some I’m going to try to more in the future.
Graham.
Hi Graham,
appreciate the feedback. I agree with your thinking re: trying to build into my good positions more but I struggle in practice. Partly because of (as you rightly say) my employment status. Partly because there is a constant conflict going on somewhere between my left ear and my right ear :-) eg....
When I bought Tesco (LON:TSCO), I bought a large position because I thought it was low risk and I could benefit from a decent 5%+ yield when interest rates were low. What I didn't expect was to make a reasonable sized capital gain out of it.
I bought HgCapital Trust (LON:HGT) off the back of one of the Money Makers podcast interviews. The discount to NAV was unusually large and it is different to say Harbourvest Global Private Equity (LON:HVPE) in that the former has only 15 to 20 positions so the NAV should be easier to calculate. But I just doubted myself a little and didn't put on a full trade which I now regret but at least I have a decent (unrealised) capital gain on a trust that pays a tiny dividend.
On the other hand, I thought I had got it right back in late 2021 when I bought a full trade in North Atlantic Smaller Companies Investment Trust (LON:NAS) at a large discount only for that discount to get wider. It was only when I realised Christopher Mills had no interest in the discount (no significant buybacks) or updating retail investors (the written interim and annual reports are poor) that I eventually sold and realised a 15% ish loss. On the positive side, I gained some bought experience.
I could go on but I don't want to bore people with my trades! Two things are for sure:
1.) I make money now I have rid myself of that awful blue sky share habit. That was pathetic but it is gone for good and has been for a number of years. Good riddance. Others on this site almost certainly make a better annual gain than me but I make a positive return most years now I stick to some basic rules and take things slowly.
2.) I can't keep track of too many positions. About mid-teens is my limit hence my biggest position is TN25 gilt which gives me a return of sorts (approx 4.5% APR), matures in late Jan-25 and allows me to keep the cash in my stocks and shares ISA waiting for a better idea to come along. Boring but sensible I think.
I am trying to use the dip in some prices (eg: BlackRock World Mining Trust (LON:BRWM) to top up. It's a long-term wait and see process for me. I am happy with that.
SSB
Thanks for keeping this thread going. I enjoy reading all the posts through the week as well as listening to the Money Makers podcast and using the aic website for all my IT research! Jpmorgan Uk Small Cap Growth & Income (LON:JUGI) has had a great run recently, and I have taken some money off the table. I'm now looking for IT ideas that are still undervalued and primed for a similar run. I'm looking for Investment Trusts that are trading below NAV and have had a recent pullback or those which are languishing and bumping along the bottom but conditions are improving, but not yet noticed by Mr Market! All ideas welcome.
Augmentum Fintech (LON:AUGM) and Manchester And London Investment Trust (LON:MNL) look interesting. Depends on your view of tech. and finance companies. AUGM used to be at a premium !
Re Japan- meant to say my concern is how japanese private investors will rea`ct- as some will be new to investing "The Japanese government has been actively promoting investment by individuals, who have more than half of their assets in deposits, according to Morgan Stanley."
Hi Charles,
Like you say, best to wait for the situation to settle. That might present a really good entry point when that happens. Can you keep us posted on your thoughts please?
Graham.
Graham, Lazards produced this a few weeks ago https://www.lazardassetmanagem...
I should have sold 10 days ago- today may of been a bit late to sell, but had a decent gain with NAVF and just had the dividend from CCJI.
Medium to long term Japan looks good- how to be involved is the question. Currency moves have affected most investment trusts performance, so am also going to look at ETF's. Some time ago(Nov 2023) I recall an investor had done far better with an ETF re Investment trusts-"I've held WisdomTree Japan Equity UCITS ETF JPY Acc (LON:DXJP) for a few months. It's a GBP hedged Japan equity ETF which has done the opposite to Baillie Gifford Shin Nippon (LON:BGS) . Up 39% year to date ! No idea if it will continue to do so wel,l but currency not such an issue"
Thanks Charles,
A very interesting read.
I’m interested in trying to buy the bottom regarding Japan. I don’t see them as a basket case but rather an economy and country going through tough times regarding their stock market, which must present good opportunities? Just a question really of timing and where to invest and with who?
I don’t know anything about ETF’s and so need to look into them more to get a better understanding. I’m sure there are others who view this thread often, who may be in the same boat. Maybe we could have a focus on learning about them.
The idea of buying the bottom at some stage and to have a holding in that region still looks like a good strategy.
Graham.
I have sold out of the 2 Japanese trusts Nippon Active Value Fund (LON:NAVF) and CC Japan Income and Growth Trust (LON:CCJI) I hold this morning due to market turmoil. In profit and wanted to protect those while I examine what is going on in more detail. I will buy in again once things settle.
Citywire mention RIT Capital Partners (LON:RCP) (I hold and hope it does. recover) https://citywire.com/investmen...
First time poster here having been a subscriber for a few years. This is my go to resource on this platform. Huge thanks to Charles for kicking this off and maintaining it as well as to all the other contributors. I made a decision about 3 months ago to reposition the bulk of my portfolios into investment trusts - particularly infrastructure, renewable energy and real estate. The discounts and (in most cases) covered dividends were just too tempting and with interest rate reductions on the horizon it seemed likely the discounts would narrow. On the evidence of the last couple of months and particularly today, that thesis seems to be being borne out. Loads of value across the IT universe. If the powers that be sort the cost disclosure issue that will offer another leg up. As professional commentators have said this feels like a generational opportunity. Happy investing all.
Riskoslaven- I am sure that with the efforts of the AIC this will be resolved. As I have said before I worked in the Investment Trust sector back in the 1980's- discounts were huge. A combination of corporate activity, change of investment style- many in those days were pretty poor- led to discounts narrowing sharply. In the US this happened earlier - mainly due to corporate takeovers.
I find the failure of Pershing Square Holdings (LON:PSH) to launch a huge fund in the USA not surprising when the UK fund trades on a large discount. The discount I think is not justified- they have performed well recently. But obviously investors in the USA just thought why buy now when they could buy later at a discount. UK trusts have had the same issue - why should specialist funds like Augmentum Fintech (LON:AUGM) ,Hydrogenone Capital Growth (LON:HGEN) , Seraphim Space Investment Trust (LON:SSIT) to name a few trade a discount- it is madness in my opinion, these are the funds that give an exposure to industries that will grow and small investors/many investment funds cannot access .
The private equity sector has been also derated- again seems odd when as far as they disclose assets are performing well.
It is more a lack of understanding of the opportunities many trusts offer- rather than the fee declaration in my opinion.
The Trust sector needs to perform- they have the advantage of gearing- which unit trusts cannot do. Maybe some funds just do not have good enough managers- this is something Boards need to look at.
The potential issue is the Boards are sometimes quasi appointees by the managers.
Email the board if your unhappy with performance-I do- not always easy but use the investor contact email and ask the board to be forwarded the email. This should then be minuted.
To conclude not sure the cost disclosure is the main issue
Charles
I appreciate these monthly Inv Trust updates.
I hold a number of IT’s across different sectors, and your monthly posts generates very interesting comments.
Keep up the good work.
I have started a separate board for Trusts realising assets, undergoing strategic review. https://www.stockopedia.com/co...
The manager of Pershing Square Holdings (LON:PSH) investment trust, Bill Ackman, has scrapped the launch of Pershing Square USA on Wednesday, days before the proposed new fund was supposed to begin trading on the New York Stock Exchange:
https://www.reuters.com/market...
This might have an adverse effect on the UK share price of PSH, because Ackman had previously announced that the management fees of Pershing Square USA would reduce the performance fees of PSH.
That is a big shame - I was hoping the launch of the US vehicle would propel the UK one higher. Will have to wait and see what happens, but the UK vehicle Pershing Square Holdings (LON:PSH) has been a great performer over recent months. I hold.
GCP Infrastructure Investments (LON:GCP) tipped in Telegraph. Appears not to be behind a paywall as I do not subscribe. I am going to look into it "
It’s a sign of the challenging times for London-listed investment companies that one of the best ways of making money in the sector over the next two years is to buy shares in a fund that is liquidating its assets and pulling down the shutters.
GCP Asset Backed Income, a debt fund, told shareholders a month ago it could make them 39pc a year by unravelling its £388m portfolio of mostly property loans by December 2027."
https://www.telegraph.co.uk/mo...
I must make a list of all the trusts that are liquidating. Maybe others could mention ones you know are?
Hi Charles, chatGPT answered with the list below (sourced from AIC for most responses).
I hold GCP Infrastructure Investments (LON:GCP) as part of my renewables/infra 'too cheap to ignore, have a socking great divi while you wait' list , and it has been moving up nicely this year. It has disposed of a wind farm this year, but there isn't an obvious reason (that I can see) for the move up, but what do I know!!
I do wonder whether there is confusion between this IT and the GCP Asset Backed Income Fund (LON:GABI) wind up, as I have seen several quotes (on Citywire) stating that GCP is winding up, and indeed a comedy RNS on 16th Jan to correct the company mentioned from GCP to GABI. ie GCP could be being swept along by the GABI wind up play..
Chatgpt response:
Several UK investment trusts have announced plans to liquidate or wind down. These trusts are in various stages of returning capital to shareholders or are in the process of selling their assets. The investment trusts that have announced liquidation plans include:
1. **Abrdn Diversified Income & Growth**: This trust plans to return approximately £115 million to shareholders in the first half of 2024. Due to a significant portion of its assets being in private markets, full repayment to shareholders may take until 2029 or later【6†source】.
2. **Abrdn Property Income**: This trust is also in the process of winding down and returning capital to shareholders【5†source】.
3. **Digital 9 Infrastructure**: Plans to liquidate and return assets to shareholders have been approved【5†source】.
4. **Downing Strategic Micro-Cap**: This trust is winding down its operations and returning capital to investors【5†source】.
5. **GCP Asset Backed Income**: This trust has approved plans to realize its assets and return capital to shareholders【5†source】.
6. **Riverstone Credit Opportunities Income**: This trust is in the process of liquidating its assets to return capital to shareholders【5†source】.
7. **Triple Point Energy Transition**: Similar to the others, this trust has approved a plan to wind down and return capital to its shareholders【5†source】.
8. **Ediston Property**: The trust is in advanced discussions to sell its entire portfolio as part of its liquidation process. This comes after a strategic review aimed at addressing its size and discount issues【7†source】.
These liquidations reflect a broader trend in the investment trust sector, where many trusts are exploring options like mergers, buybacks, and fee reductions to enhance shareholder value【5†source】【7†source】.
https://www.theaic.co.uk/aic/n...
https://www.investmentweek.co....
Charles
If it is of interest, I noted on another bulletin board that someone has recently started a thread on this theme.
The charts listed in the header at the top have been filtered down somewhat by the poster that started it all, there’s quite a list of them. But the thread has only been going a few weeks so wouldn’t take long to read it from the start.
https://uk.advfn.com/cmn/fbb/t...
Thanks M48.
abrdn European Logistics Income (LON:ASLI) is realising its portfolio.
Dunedin Enterprise Investment Trust (LON:DNE) is realising its assets. Should have recalled that as I hold! Announced NAV of 626.7p -price is 504. Maybe I should buy more
Investment Objective
The investment objective of the Company is to conduct an orderly realisation of its assets, to be effected in a manner that seeks to achieve a balance between maximising the value of the Company's investments and progressively returning cash to Shareholders.
Thanks for keeping these monthly IT threads going Charles. I am a regular reader but only an occasional contributor (I only own four trusts). They are a great addition to the site.
Thank you BL.
Polar Capital Technology Trust (LON:PCT)
I hold this one but am unsure what to make of an announcement by the Company of a 'subdivision' of its shares, subject to shareholders agreement on 11.9.24. If approved, shareholders would receive 10 new shares for everyone they currently hold.
I have seen consolidations in other cos where there is a reduction in the no of shares corresponding to the same value held, This 'same value' is true in PCT's case too, but is an increase in shares to the tune of 10-fold . I don't like the sound of it very much, but then again don't quite understand the reasoning.
Both Mitchells {ken (hi ken, good to see you active on this site) and charles} are very clued up about Inv Trusts (thank you b the way for steering us to the 'all posts' as it isn't always obvious when a comment has been added to the IT thread ) - i very much appreciate the effort you are put in into this; hope you can help with my query.
Hope you pick up this post and if you can clarify matters for me that would be much appreciated. I'm in two minds to sell , but since the announcement the sp has actually gone up so perhaps the market isn't unduly worried?
dartagnan2019
Hi dartagnan - I haven't read the RNS, but share splits are fairly common and simply allow the number of shares to multiply and bring the price per share down to a lower level - it doesn't change the overall market cap of the company ie. at a current £34 per share, this split will simply mean that there are 10x more shares in circulation, but their price will be £3.40 - as an example.
There are a couple of reasons for this split, often just simply to make trading easier for smaller holders.
As I say, I haven't read the detail, but if it is a simple 10-1 split then it would not be a reason to sell. For example if a bunch of bananas was being sold for £10 each (with 10 bananas per bunch) all they are doing is splitting the bunches up and selling individual bananas for £1 each.
If I held Polar Capital Technology Trust (LON:PCT) as a long term hold I would not see this as a reason to sell.
Others may have more detail from the RNS.
Hi dartagnan,
I haven’t looked at the announcement but would guess it’s to reduce the cost of each share without changing the value of the said shares.
I looked at investing in this previously but the shares were a high amount and for the money I was prepared to invest, I wouldn’t have many shares. So the price put me off. If and when they split the shares 10-1, I may re-visit the trust. This is all a bit academic really as the value isn’t changing and the shares usually go up/down on a percentage basis. But the shares may look more attractive to small retail investors if they were of a smaller amount of money (not cheaper) hence why the share price may have risen, if all things are equal.
hope that explains it without confusing you.
Graham.
Edit,
My post was after Kevin’s better explanation but before I had seen it. We’re both saying the same thing in a different way. I wouldn’t use this as reason to sell either, in fact I think it’s a good idea so long as there’s not a big administration expense. But I doubt that.
Graham.
dartagnan- Agree with the others-I hold. Should just make the shares more liquid- and it does attract investors who do not like paying £xx.xx for a share. Illogical but true. Some high prices are a pain- I buy ETF and some of those are in the £100's each ! So if you invest say £1000 you might only get 1 share of say £600. I am holding PCT for the medium term- pretty confident in the managers.
Thank you Tim
Hi dartagnan
Thanks. It’s good to see you posting here and (thanks especially to Charles’s efforts) to see the Investment Trust threads really coming alive. It’s a good time for this to be happening as at long last things are really looking up for the sector with some excellent opportunities getting flagged here now.
As for your Polar Capital Technology Trust (LON:PCT) share sub division question, you’ve now had replies to explain and reassure so there’s not much I can add. Share consolidations or the alternative sub divisions (also called share splits) have no effect either on the value of your holding or the prospects for the Investment Trust or Company undertaking them.
Just one thing to add in reply to Graham and that’s that the percentage daily or monthly etc gain or loss for a share or Investment Trust is exactly the same after a sub division or consolidation. I.e if the pre consolidation share price is £50 and the share price goes up to £55 that’s a 10% gain. So it is after a 10 for 1 (or whatever) sub division to bring the share price down to £5. If the share then goes up to £5.50 that too is a 10% gain.
Some small investors wrongly think that a share with a high nominal price like £100 can’t possibly go up as much as a share with a nominal price of 10p. Of course it can! It’s a 10% gain when the 10p share price goes up to 11p. And it’s also a 10% gain when the £100 share goes up to £110.
Like the bell whether retailer Next (LON:NXT) after their positive trading update today. The share is up 8% from £91 to £98. (And Marks and Spencer (LON:MKS) plugged strongly on Mike Walters site at £1 and even lower has now more than tripled to £3.30. Hope a few of Mike’s subscribers who are now here have done well with Marks).
Thanks all for your replies re Polar Capital Technology Trust (LON:PCT), much appreciated.
I just couldn't see the logic of a tenfold increase in share count, but clearly from your reponses no need to worry. Ill ogival really as Charles and ken are saying, other than (possibly) greater liquidity. I feel reassured now and will continue to hold (hoping the tech market doesn't go too much more off the boil). Thanks again, regards, dartagnan
dartagnan.
A key plus point that the replies might not have made clear enough is that overall it can be a very good thing to have a share subdivision/split. Take Lindsell Train Investment Trust (LON:LTI) as an example. The share price is £820. That high nominal price puts off small investors as it makes small trades like a £2000 buy near impossible. The investor can buy 2 shares at a cost of £1640 or 3 shares costing £2460. So with a £2000 stake impossible the investor has to go for either £1640 or £2460.
And then look what happens if the investor wants to take a 20% profit from that 2 share holding if the share price rose 20% from £820 to £1000. . He/she can’t do that. The choice is either to continue to hold the 2 shares or to sell 1 leaving only a £1000 stake left.
If Lindsell Train Investment Trust (LON:LTI) were to go for a 100 for 1 share split it would bring the share price down from £820 to £8.20. Now it becomes so much easier to trade and have modest stakes, and it could well attract more buying which would be good news for the share price.
I don’t hold Polar Capital Technology Trust (LON:PCT) or Allianz Technology Trust (LON:ATT) as wondering whether tech shares are due to fall after their extraordinary bull run. Amazon.com (NSQ:AMZN) Results tonight disappointed. It’s issues like that rather than share subdivisions that affect the share price.
Just to add to what others have said - its likely at least one of Polar Capital Technology Trust (LON:PCT) 's holdings will have done a share split itself - Im guessing it holds NVidia which recently did a 1 > 10 split.
What a volatile month in July- big winners and losers. I am not that familiar with all of them so not sure what spread/liquidity is like, whether an announcement etc. Tech took a bashing. Never held Manchester And London Investment Trust (LON:MNL) but it looks like one to keep an eye on- it i soften near the top each month-or the bottom ! Not sure what happened to Vietnam Enterprise Investments (LON:VEIL) - maybe an opportunity but would need to look at it more carefully. I hold Augmentum Fintech (LON:AUGM) and the price movement baffles me. China is not bouncing yet- my small ETF holding is down, but not concerned. Unless there is a major International incident brewing in the Far East and then we should all hold gold.