Investment Trust- Thoughts (May 2024)

30th Apr by Charles Mitchell

116 comments 5876 reads

Investment Trust- Thoughts (May 2024)

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.

The Investment Trust Handbook by Jonathan Davies has articles and data on Investment Trusts. The 2024 edition is out now.
Available online or from 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.

April 2024 Investment Trust monthly performance.

Equity invested only.

Top 10

Hipgnosis Songs Fund (LON:SONG) +51%

abrdn New India Investment Trust (LON:ANII) +14.4%

Schiehallion Fund (LON:MNTN) +13.1%

RIT Capital Partners (LON:RCP) +12.9%

Pacific Horizon Investment Trust (LON:PHI) +11.7%

Rockwood Strategic (LON:RKW) +11.4%

Molten Ventures (LON:GROW) +10.5%

Jpmorgan China Growth & Income (LON:JCGI) +10.2%

Fidelity China Special Situations (LON:FCSS) +10.2%

abrdn Equity Income Trust (LON:AEI) +10.1%

Bottom 10

Schroder British Opportunities Trust (LON:SBO) -9.4%

Gulf Investment Fund (LON:GIF) -9%

Intuitive Investments (LON:IIG) -8.8%

Bellevue Healthcare Trust (LON:BBH) -8.7%

Vietnam Enterprise Investments (LON:VEIL) -7.4%

Scottish Mortgage Investment Trust (LON:SMT) -6.8%

Manchester And London Investment Trust (LON:MNL) -6.8%

JPMorgan Japanese Investment Trust (LON:JFJ) -6.5%

International Biotechnology Trust (LON:IBT) -6.1%

All Trusts

Top 5

Hipgnosis Songs Fund (LON:SONG) +51%

Gresham House Energy Storage Fund (LON:GRID) +36.4%

Macau Property Opportunities Fund (LON:MPO) +32.1%

BlackRock World Mining Trust (OTC:BWMTF) +16.6%

Aquila Energy Efficiency Trust (LON:AEET) +16.4%

Bottom 5

…

Unlock with Email

Unlock with Google

Already have an account?
Login here

Charles Mitchell

28th May

Not sure the point of Odyssean Investment Trust (LON:OIT) tender offer given hardly any discount. But they said they would every 7 years- but the winners are the lawyers and advisors , not shareholders. We will no doubt see what the costs are. one day. I can see hard for the board- maybe tender offers should be triggered on average discount not a time period.

Digital 9 Infrastructure (LON:DGI9) Just received this:

"Regarding the fees paid to advisers, I refer you to Note 6 (Investment Management Fees), Note 7 (Other Operating Expenses) and Note 19 (Commitments and Contingent Liabilities) of the Notes to the Financial Statements in the results for the year ended 31 December 2023. The Board currently retains an independent financial adviser (Liberum) and sole corporate broker (J.P. Morgan Cazenove); following the approval of the managed wind-down by shareholders, Peel Hunt LLP resigned as corporate broker on 3 April 2024.

In relation to the fees for the Verne Transaction, as set out in the same announcement of 30 April 2024, we note that the level of costs for the transaction reflects the transaction’s complexity in contemplating different transaction structures and executing the sale of three separate legal entities in three different jurisdictions.

As approved by shareholders on 25 March 2024, during the Managed Wind-Down, which is likely to progress over several years, the Board will focus on preserving shareholder value by continuing to carefully manage the Company’s operating costs and additional advisory and transaction costs throughout the Managed Wind-Down.

As announced on 25 March 2024, and as set out in the Notice of AGM dated 21 May 2024, the Company has appointed Liberum Capital Limited as its financial adviser to support the Managed Wind-Down process and provide the Board with an independent review of the Company’s options for its investment management arrangements going forward. In doing so, the Board aims to ensure that the interests of the Company’s manager and shareholders are closely aligned as the Managed Wind-Down progresses. This review process is progressing well and the Board will provide an update once it has been completed.

With regards to the Going Concern, we note that with regards to the 2023 Annual Report (and previously in the June 2023 Interim Accounts) that the Financial Statements were prepared on a Going Concern basis however that there exists a material uncertainty which may cast significant doubt over the Company’s ability to continue as a going concern. This material uncertainty relates to the timing of ongoing strategic initiatives which includes management’s ability to refinance or repay the Group’s existing RCF due in March 2025. However, following the repayment of more than 85% of the March 2024 outstanding RCF balance (£373.8 million), the Board expects to use initial proceeds from the Managed Wind-Down to repay the outstanding RCF balance of £53 million, thereby addressing the Group’s residual financial uncertainty. "

Neil81

29th May

Hi Charles. You are quite right about this but I would not jump in just yet. I believe that there is too much to be sorted out in the battle between BIG Oil and the Alternative industry. There is also the possibility of nationalisation (I refuse to use American spelling) occurring sometime in the lifetime of a new government. Surely plenty of long term opportunities here, but maybe not in the short term.

Willinvest

Foresight Sustainable Forestry (LON:FSF), an IT that I mentioned here (10 May), BoD recommend offer by Arizona Bid LTD, a vehicle wholly-owned, indirectly by Averton Park Ltd at a 32.88% premium to yesterday's closing price.

I certainly hadn't considered this outcome (having sold my stake a week ago shortly after the SP barely moved after a revaluation accounting for new planting) but it does show the significant value on offer of heavily discounted ITs that is often hiding in plain sight!

That is harsh Willinvest.

Brucie5

Thanks, I tend to agree. I picked up some NESF this morning to add to my GSF. I think it's clearly a case that a. the market doesn't trust the dividends and b. it doesn't understand the business case. I particularly like GSF on account of it's geographic diversification; but NESF has recently upped the dividend, so my feeling is these payouts will be more or less sustainable, against background of falling interest rates. So there could be a significant reappraisal in due course.

30th May

Brucie5 NextEnergy Solar Fund (LON:NESF) The yield of 11%. is appealing- I see they have increased dividends consistently.

Lincs

Brucie5 - also holding NextEnergy Solar Fund (LON:NESF) , although a somewhat reduced amount as sold a few when they peaked just shy of 120 - in hindsight should of sold the lot :-) In this sector I am now favouring TRIG, diversification in both technology and geographically. Less divi but still around 7.4%. Sharepad has a forecast to double turnover in 2025 - I'm taking that with a pinch of salt but it is encouraging. Good write up by Keplar recently

https://tinyurl.com/mvh3avh7

OldSchool05

Comment I made on this trust at the beginning of April: NextEnergy Solar Fund (LON:NESF) has been a disappointment. It was Peter Spiller on a recent Money Makers podcast who raised similar concerns about this Trust, adding that the sale they did make was to a related party. More concerning in this case is the loan to value being quite high, with about half of those loans being at floating rate. He makes the point that it is very difficult to borrow at a rate of, say, 7% floating, and make a profit on these renewable assets.

Management here has indicated for at least a year that they have plans for asset sales to reduce floating rate gearing but have failed to deliver so far. I hold but it is on the sell list if progress is not made on asset sales

ShoeShineBoy

1st Jun

Always interesting to read a MIGO update.

I didn't realise Phoenix Spree Deutschland (LON:PSDL) are "effectively" in wind down.

https://tinyurl.com/yttnwrjw

Thanks Charles. I must have been tired the night I typed my original post as the AIC web site is the obvious place to get the latest data on trusts.

I sold Tritax Big Box REIT (LON:BBOX) a few years back and bought Tritax EuroBox (LON:EBOX) but the latter performed poorly, with the discount to NAV just getting wider.

Tritax Big Box REIT (LON:BBOX) is on a yield of 4.58% versus Tritax EuroBox (LON:EBOX) which is on 7.94%. But the former has been much more stable from a SP perspective. I think the former will sell off the non-core assets it acquired. Hopefully it will continue to trade well. I could be tempted to buy it back with some spare cash I have sitting in my account.

Tritax Big Box REIT (LON:BBOX)

Tritax EuroBox (LON:EBOX)

No one came back on the deliberate mistake from my post on Caledonia Investments (LON:CLDN) results! The trust is currently trading on a discount of 35% and not 25%! Apologies for that mis-type!

It got me thinking on the MoneyWeek portfolio that was started back in about 2012. I kept some of the paper articles and looked up the SP total return based on the last 10 years (source: AIC web site):

CLDN: +110.4%

PNL: +67.3%

SMT: +358.3%

FGT: +95.3%

RIT: +67.5%

LWDB: +138.6%

Assuming an equal split of investment, this equates to a 10 year return of 139.6% (annualised return of 9.09%).

This compares to an MSCI global index return of 202.3% (11.7%) Source: iShares MSCI Index.

I always thought the MoneyWeek portfolio was pretty good but actually it quite average in hindsight. Plus Scottish Mortgage Investment Trust (LON:SMT) did most of the heavy lifting!

I was originally attracted to MoneyWeek by the retire early articles.... still a work-in-progress for me :-)

https://tinyurl.com/3p3e9vdx

SSB

Schroder Oriental Income Fund (LON:SOI) reported interim numbers a week back. I only got round to reading the commentary today. The trust manager's comments on China are worth reading. Plus the buybacks and dividends are positive in my book.

Schroder Oriental Income Fund (LON:SOI) has performed well compared to it's peers in the Asia Pacific Equity Income sector. I may well add to my position at some point for some diversification away from a lot of UK earning trusts and stocks.

https://tinyurl.com/y8bu3zr9

SSB

ken mitchell

Hi ShoeShineBoy

Good to read your latest posts. I’ve had to focus on health issues recently but hope now to get back to joining you and others in posting on Investment Trusts where there are still bargains galore.

Like you I like but don’t hold Schroder Oriental Income Fund (LON:SOI). I’m still keen on Tritax EuroBox (LON:EBOX) and see the fall back towards the lows as another buy opportunity. A good chance that EBOX could feature in sector consolidation, and anyway the discount looks too wide. AND lower interest rates soon in Europe not factored in either.

I bought Phoenix Spree Deutschland (LON:PSDL) recently influenced by comment from Nick Greenwood. It’s been a terrible performer and until recent potential sell off of some of their Berlin properties news a definite avoid, but now worth a punt.

Fuller info with their recent results here:-

https://www.stockopedia.com/sh...

Guess that Charles Mitchell will soon be starting the June Investment Trust thread. He has done a great job in getting these threads going and seeing increased interest as have you with your great posts when you have what seems to be a rare bit of spare time!

Graham Wells

Welcome back Ken,

Hope your recent hospital treatment went well! Great to see you back posting and also to read SSB’s well researched and written posts.

I would be interested in your thoughts on Tritax Big Box REIT (LON:BBOX) who have done well with the SP recently after the take over. They have talked about disposals of some of the smaller properties gained in the takeover. So may be a little bit further to go with the SP even without the lower interest rates.

Best regards, Graham.

2nd Jun

Been away Ken- trying to watch Cricket-Eng v Pakistan in a rainy month. Just setting up now.

3rd Jun

Thanks Graham for the good wishes. I hope so too but it’s uncertain for now whether it has worked. I can’t help on Tritax Big Box REIT (LON:BBOX) as it’s not one I’ve followed but presumably you read ShoeShineBoy’s recent post that included BBOX?

chrismorris44

Brookfield have confirmed they are sniffing around Tritax EuroBox (LON:EBOX) hence the price spike today….

And a special thanks to Ken for originally highlighting this on the good old Michaelwalters.com investment board.

Yes Ken,

I did read SSB's post below on Tritax Big Box REIT (LON:BBOX) regarding the sell off of some of the smaller properties gained in the take over that would not be worth keeping . I agree with his comments. I also read about this in some of their announcements at the time. There was also the fact that, at the time of the take over, the Chair of the trust being taken over was against it as he felt they could have got a higher price if they waited but he was out voted. The SP seems to be supporting the take over as well. The news about a possible take over at Tritax EuroBox (LON:EBOX) will probably also help to support as further possible consolidation may happen in that sector.

Graham.

Investment Trust- Thoughts (May 2024)

Investment Trust- Thoughts (May 2024)

Unlock the rest of this article with a 14 day trial

About the Author

Charles Mitchell

116 comments

Unlock the metrics for all these stocks and more...

Unlock the metrics for all these stocks and more...