Investment Trust-Thoughts (Feb 2024)

31st Jan by Charles Mitchell

152 comments 7628 reads

Investment Trust- Thoughts (February 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.

January 2024 Investment Trust monthly performance.

Any errors please advise.

Equity invested only.

Top 10

Foresight Sustainable Forestry (LON:FSF) +24.8%

Barings Emerging Emea Opportunities (LON:BEMO) +12.1%

Marwyn Value Investors (LON:MVI) +9.9%

Crystal Amber Fund (LON:CRS) +7.1%

Allianz Technology Trust (LON:ATT) +7.1%

India Capital Growth Fund (LON:IGC) +6.6

Manchester And London Investment Trust (LON:MNL) +6.6%

Chrysalis Investments (LON:CHRY) +6%

Polar Capital Technology Trust (LON:PCT) +5.4%

River and Mercantile UK Micro Cap Investment (LON:RMMC) +5.2%

Bottom 10

Jpmorgan China Growth & Income (LON:JCGI) -10.8%

Fidelity China Special Situations (LON:FCSS) -9.9%

Pacific Assets Trust (LON:PAC) -9.9%

Baillie Gifford China Growth Trust (LON:BGCG) -9.7%

Augmentum Fintech (LON:AUGM) -8.9%

Worsley Investors (LON:WINV) -7.8%

BBGI Global Infrastructure SA (LON:BBGI) -7.8%

Blackrock Latin American Investment Trust (LON:BRLA) -7.8%

Weiss Korea Opportunity Fund (LON:WKOF) -7.7%

HICL Infrastructure (LON:HICL) -7.1%

Including Energy and Commodity funds, Property, Fixed Interest.

Top 5

Grit Investment Trust…

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jmallin1972

22nd Feb

Due to the falling share price is EBOX expected to fall outside the FTSE 250........if so, what that further supress the SP short term with some funds having to sell it?

ken mitchell

BnB

So far the M&A across the Investment Trust REIT sector is distinctly underwhelming with all share offers well below NAV but sector consolidation makes sense and the result of the amalgamations should be positive with stronger Trusts the likely outcome.

As for your Tritax EuroBox (LON:EBOX) share price forecasts………goodness knows if interest rates have to come down dramatically because of a sudden big new crisis! All bets are off on that news across our portfolios!

Otherwise I’m hoping for share price in 60s as interest rate cut expectations continue the rally that’s already started, and then to low 70s on the cuts themselves to cement the gains. That would still mean Tritax EuroBox (LON:EBOX) trading at a double figure discount to NAV. IF in time the sector comes right back on to favour again and discounts largely disappear AND with NAV increase, as as reduced LTV levels, then 90p plus AND for those who bought around the recent low of 46p a doubled share price and a near 9% dividend locked in, with possible dividend increases too. But for now that’s cloud cuckoo land!

Lincs posted a very good quoted data analysis link the other day that got just 2 ticks and no follow up. It’s well worth anyone reading this, reading the QuotedData info too. Here’s the link again:-

https://quoteddata.com/researc...

Charles Mitchell

VietNam Holding (LON:VNH) January report. (I hold)

Vietnam Holding Limited (VNH) Investor Report – January 2024

Banking on the Year of the Dragon

As figures for January show, Vietnam’s macro-economic landscape provides a promising setting for growth in the Year of the Dragon. To start, the country celebrated a significant trade surplus of USD2.9bn in the first month of 2024, with both exports and imports posting the strongest growth seen over the past two and a half years.

Exports of electronic items led this jump, with high shipments of products in general to all key markets. The momentum in retail sales also continued from the month before, with a solid 8.1% year-on-year (YoY) rise despite the high base given Tet fell in January in 2023. The sustainable growth was driven largely by travel services, which had a stunning rebound, even marginally exceeding pre-Covid levels. Manufacturing activity in Asia overall improved considerably in January, particularly in Vietnam and South Korea, as stronger demand from major markets offset the slump in China. For the first time in five months, Vietnam's PMI rose over 50.

Increases in Vietnam's foreign direct investment (FDI) and public investment disbursement in January are also worth highlighting. Registered FDI reached USD2.4bn, up 40.2% YoY, the highest level seen since 2020. Much of this rise came from new commitments, indicating a strong start to the year, with more than half coming from the property industry. Furthermore, public investment increased by 12.5% YoY, accounting for 4.4% of the 2024 plan, and we expect this to remain one of the government's primary priorities in 2024.

With liquidity further easing and inflation cooling, favourable effects of Vietnam’s monetary policy are likely to become even more effective for its economy in 2024. Plus, in terms of building greater trust, the Vietnamese authorities’ anti-corruption effort continued to hit headlines in the few weeks of 2024 with several significant events in both the public and private sectors.

For example, the People's Court in Ho Chi Minh City installed security cameras and additional fire safety equipment to safeguard six tonnes of files related to the Van Thịnh Phat scandal. The municipal Party Committee also said that it will compensate persons who report corruption with up to VND 10m (USD 420) "if their information is accurate and helps the competent agencies verify and handle corruption and negative acts." In addition, the Ministry of Home Affairs issued a regulation declaring that top government personnel should not seek "fame or power”.

As Vietnam’s stock market rally continued, January proved positive for Vietnam Holding as well, as it once again outperformed with a NAV of +2.4 versus VNAS’s 1.8%. January’s gains were largely about the banks, which have been benefiting from improved credit over recent months. The Fund is well-positioned for growth in 2024 with a modest price-to-earnings ratio of 10x and strong forecast earnings per share growth of 30%.

It is worth noting that the Fund has the narrowest discount (by far) of the three London-listed Vietnam focused funds, another compelling reason to feel good about the year ahead. At time of writing the discount has narrowed to 3%, and the share price has hit an all-time high. The Chairman of Dynam Capital, Craig Martin, will be in London, Edinburgh and Guernsey between March 18-22, do reach out if you would like to meet up in person.

We wish all investors a safe and prosperous lunar new year, and welcome the Wood Dragon.

jonno

23rd Feb

Morning Ken,

Most of my investment activity is in UK small caps held within an ISA, however I have a small IT portfolio and have been looking at Vietnam Trusts. Like most investors I have to sell to buy and have been pondering a purchase of VinaCapital Vietnam Opportunity Fund (LON:VOF).

However I haven’t been able to come to a conclusion as to why it trades on such a wide discount relative to the other Vietnam trusts? Is it for example its main holdings or perhaps the manger that are currently out of favour or is it just market malaise?

Can you provide an insight?

I have bought some Gresham House Energy Storage Fund (LON:GRID) for the Income ISA of my wife's. They announced an Capacity Market auction result this morning- and with a discount of 56.3% and a yield of 8.6% plus a share buyback in place looks relatively risk free. It is the 2nd highest Trust in the Renewable energy Infrastructure sector of the AIC, which I do not quite get as Gore Street Energy Storage Fund (LON:GSF) (also hold) is on a discount of 38.6% and a higher yield.

The full announcement is here

Salient points in summary are these

"We're pleased with these results from the latest annual Capacity Market auction, as well as their expected positive contribution to our NAV from 31 March 2024.

"the additional contracts are expected to generate £3.2mn of additional revenue from October 2024 to September 2025."

Jonno

There have been a lot of posts on this thread that answer your question about the unusually wide VinaCapital Vietnam Opportunity Fund (LON:VOF) discount as well as on the other Vietnam Trusts and on prospects etc for Vietnam market.

If you scroll through this thread you’ll come to my post written last Saturday that directly answers your VOF big discount question and making the case that this looks an excellent VinaCapital Vietnam Opportunity Fund (LON:VOF) buy opportunity.

Note that in that post last Saturday I pointed out that VinaCapital Vietnam Opportunity Fund (LON:VOF) NAV has (as is the case with VietNam Holding (LON:VNH) and Vietnam Enterprise Investments (LON:VEIL) too ) seen an INCREASE in NAV this year but a share price FALL!! The other 2 Trusts have both seen share price gains.

donald pond

Supply and demand is the answer. Stockopedia tends to make people focus on the market as a weighing machine, but VinaCapital Vietnam Opportunity Fund (LON:VOF) is a prime example of how, in the short term, its a voting machine. When you drill down to the holders, you find:

There is no similar imbalance at the other funds. So this looks like Lazard selling out and putting a lid on the price. Undoubtedly worth taking advantage of the discount, but it won't change until the selling stops.

By comparison, VNH is smaller and nobody is selling and VEIl is bigger but attracting sizeable buys

Could be that VNH have a better marketing- Craig and the VMH managers are grood communicators. My preferred Vietnam fund and is performing well. They respond to questions promptly- which I like- as said before.

25th Feb

Switching part of our VNH holding into VinaCapital Opportunity Fund VOF tomorrow. The discount is appealing plus a small yield which VNH does not have.

I will create the March discussion on Feb 28th a.m- I am away from Weds afternoon and easier to do with the 2 screens in my office rather than a laptop. So top 10 etc will show last 30 days performance.

Many thanks Charles. Your idea of a new thread every month is great and even better that you are prepared to do it. Interest in Investment Trusts is slowly increasing as a result.

As for Vietnam, VinaCapital Vietnam Opportunity Fund (LON:VOF) or VietNam Holding (LON:VNH) or both and whether to invest there I’ve done a bit more digging,

First point is that the Vietnam Index is up 20% since the low last Autumn. I’m no forecaster but a chance of a temporary dip/profit taking?

Then following up the posts on the recent underperformance of VinaCapital Vietnam Opportunity Fund (LON:VOF) …..it is marked and the big discount to NAV certainly looks more something to take advantage of than to fear.

Since the nadir for Vietnam index and the 3 Vietnam Trusts in Autumn 2022 these are the share price performance figures since then:-

VinaCapital Vietnam Opportunity Fund (LON:VOF) UP just 10% since then from 406p to 441p.

Vietnam Enterprise Investments (LON:VEIL) also only UP 10% from 529p to 575p.

BUT WOW! VietNam Holding (LON:VNH) UP 60% from 232p to 372p. A good part of that massive outperformance is simply because of the narrowing of the VNH discount to just 3% while VOF has gone out to 24% discount and VEIL still on a double figure discount.

Again. Suggests that VNH is overbought while VOF is anything but.

I’ve also checked out the top 10 holdings of VinaCapital Vietnam Opportunity Fund (LON:VOF) and VietNam Holding (LON:VNH) . I much prefer conviction portfolios with a large chunk in the top 10 holdings. Both fit the bill as VOF has about 45% just in their top 5 holdings, and VNH a bit under 40%. They both hold the same shares sometimes too.

VietNam Holding (LON:VNH) portfolio top 10 has done better than VinaCapital Vietnam Opportunity Fund (LON:VOF) year to date mainly because of big 28% gain for Military Commercial Joint Stock Bank where they hold 5.6% in their portfolio. Both Trusts hold Asia Commerce Bank which is up 14% ytd. It’s the biggest holding in VOF portfolio at 13.6% compared with 4.9% in VNH portfolio.

Helpfully both Trusts issue very good monthly updates and often include comment on some of their largest holdings. The latest one just issued by VinaCapital Vietnam Opportunity Fund (LON:VOF) is below.

So it’s VinaCapital Vietnam Opportunity Fund (LON:VOF) that looks the better buy but I hold both.

https://vinacapital.com/wp-con...

Thanks Ken for that- the monthly was actually the idea of another poster though.

I had a good look as well- hence selling some of our VNH and buying VinaCapital VOF.

I do like the VNH management- Craig Martin is a great communicator and the monthly newsletters appear honest-to me. I will be buying more of VNH/VOF when funds come in- Emerging market status for Vietnam must be close and that will bring the Emerging market ETF's and other weighted funds in to the Vietnam market.

sevenccc

Hey Ken

Agree the discount on VietNam Holding (LON:VNH) seems too narrow, even heading to a premium some days. But isn't this driven largely by the excitement over their holdings in FPT? Seems a lot of comment around that this is flying and expected to be one of the tech stars this year.

I hold some VinaCapital Vietnam Opportunity Fund (LON:VOF) which has been relatively disappointing so far. Hope you're right that the discount will narrow and the NAV keep heading up. Seems a logical place to be investing but that doesn't mean we'll see a return any time soon!

Tempted to pick up a few VietNam Holding (LON:VNH) when cash available.

Hope all is well.

Hi sevenccc

I’ve seen this point about a key reason for the VietNam Holding (LON:VNH) outperformance being their stake in FPT but VinaCapital Vietnam Opportunity Fund (LON:VOF) also holds FPT. Admittedly FPT is 15% of the VNH portfolio and only 7.5% of the VOF portfolio but does that merit VNH trading near par and VOF at a big discount?

Hope you’ll post if spotting any tempting IT OR share buys.

26th Feb

I'd missed the 7.5% of VOF being in FPT so thanks for that. Could be the making of a good year for both if the pundits are right, never mind the favourable conditions in Vietnam.

The share I really like most at the moment is an oiler....Arrow Exploration (LON:AXL) . Like Petrotal (LON:PTAL) it seems to have a good growth path and should be employing 3 drill rigs as the year progresses. Reminds me of the big win we had with Mike in East Africa. Was that with Cluff Oil? Seems they hit oil with every drill. No divis yet as still proving up the field. Enough revenue to be self funding.

Have a couple of junior miners I'm interested in too. But highly speculative pints at this stage. Not really for IT thread!

Otherwise waiting patiently for inflation to come down and the REITS to take off. Holding all the property plays you mention here frequently. And happy to collect the dividends while we wait.

27th Feb

Mello have a presentation by Ocean Dial and India Capital Growth Fund (LON:IGC) at 13:00 today. Plus River and Mercantile River and Mercantile UK Micro Cap Investment (LON:RMMC) . It is free . https://us06web.zoom.us/webina...

intuitive6191

Interesting article on Citywire regarding FPT

https://citywire.com/investmen...

Rusty2

20th Mar

There has been quite a bit of movement in India Capital Growth Fund (LON:IGC) which I hold. They did fall back to around 145p but are up over 9% today. Anyone know why the large rise today?

Hi Rusty- value investors moving into the market after 5 days of decline.

See March version of Investment trust thoughts. Link to Times of India market report.

Investment Trust-Thoughts (Feb 2024)

Investment Trust- Thoughts (February 2024)

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Charles Mitchell

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