Investment Trust- Thoughts (July 2024)

Sun 10:11am by Charles Mitchell

14 comments 654 reads

Investment Trust- Thoughts (July 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.

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.

June2024 Investment Trust monthly performance.

Equity invested only.

Top 10

Foresight Sustainable Forestry (LON:FSF) +30.7%

Downing Strategic Micro-Cap Investment Trust (LON:DSM) +13.8%

New Star Investment Trust (LON:NSI) +13.4%

Manchester And London Investment Trust (LON:MNL) +12.3%

Molten Ventures (LON:GROW) +11.9%

Cordiant Digital Infrastructure (LON:CORD) +10.8%

Augmentum Fintech (LON:AUGM) +10.7%

abrdn New India Investment Trust (LON:ANII) +10.2%

Allianz Technology Trust (LON:ATT) +9.8%

India Capital Growth Fund (LON:IGC) +9.4%

Bottom 10

CT UK High Income Trust (LON:CHIB) -11.6%

Oryx International Growth Fund (LON:OIG) -9.9%

Blackrock Latin American Investment Trust (LON:BRLA) -8.9%

Jpmorgan China Growth & Income (LON:JCGI) -7.8%

Baillie Gifford China Growth Trust (LON:BGCG) -7.4%

Fidelity China Special Situations (LON:FCSS) -7.4%

Blackrock Throgmorton Trust (LON:THRG) -6.2%

Miton UK Microcap Trust (LON:MINI) -6.1%

Middlefield Canadian Income PCC (LON:MCT) -5.9%

Weiss Korea Opportunity Fund (LON:WKOF) -5.1%

All Sectors

Top 5

Foresight Sustainable Forestry (LON:FSF) +30.7%

Gresham House Energy Storage Fund (LON:GRID) +29%

Downing Strategic Micro-Cap Investment Trust (LON:DSM) +13.8%

New Star Investment Trust (LON:NSI) +13.4%

Manchester And London Investment Trust (LON:MNL) +12.3%

Bottom 5

Regional REIT (LON:RGL) …

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Charles Mitchell

Sun 10:32am

I had a pretty grim June. Held Regional Reit and Blackrock Latin America. Not bought MPO yet thank goodness- I am still watching the Macau housing market from a distance. Blackrock Latin America is just a real disappointment. I am losing faith with Blackrocks's abilities. Sold BlackRock Frontiers Investment Trust (LON:BRFI) as it had done nothing and am thinking of cutting my losses in BRLA. They write the correct words, but seem unable to make decent investments, though there has been some market turmoil. Maybe ETF focussing on Brazil would be a better idea. I had sold Molten Ventures after the takeover of the poor performing Forward Partners- a mistake with hindsight but I was fed up with Forward. At least Augmentum Fintech (LON:AUGM) has picked up. This is one of my top hopes for the next 2 years. I have nothing to say about Regional REIT (LON:RGL) - I should have stayed well clear, though if I take up my rights will be at break even. Whether I trust the management is the issue. Probably will and hope the major shareholder- and depending how many people take up rights it could be a very large holding( they have an exclusion from making a bid if they go over 30% from the Takeover panel) takes it private. Hoping July is a better month for my trust holdings !

ken mitchell

Mon 1:04pm

Charles has had an unlucky month. Most of the Investment Trusts I hold have flat lined over the last month, with the exception of Augmentum Fintech (LON:AUGM) which has risen around 8% and 20% so far this year. If there’s any pull back (as there has been before between news updates) it’s still well worth checking out as a potential buy. And arguably it’s a strong buy anyway for reasons already posted on Investment Trust threads.

Will post more on possible buys right now later today, and hope there will continue to be others highlighting Truss that look tempting too.

For now…….

……..Here’s the latest update for the Investment Trust portfolio that has been running since 2016. Performance is little changed since the start of June. It was an error not buying Augmentum Fintech (LON:AUGM) for it. AUGM is up 20% so far the year.

r/NoFinancialAdviceHere - KITE - Friday update week 433

Here’s also (again for any who missed it) info about this portfolio:-

“It’s an Investment Trust portfolio we started in 2016 on Mike Walters bulletin board, and continued to run there until Mike closed his site at the end of last year. (Mike was Deputy City Editor of the Daily Mail and a friend of small investors. His site was exceptionally user friendly. He’s now well in to his 80s and in more recent years favoured blue sky shares).

I selected a lot of the investments for this portfolio, but also sometimes after suggestions from posters there. A few are now posting on this thread too.

A poster , number33 (who subscribes here but unfortunately doesn’t yet post (he’s a very perceptive poster) presented it in a brilliant way every Friday without fail, and he is continuing to update it.

It’s a virtual Investment Trust portfolio but run exactly the same as we do our own portfolios. I.e with dealing charges and stamp duty and with the buy and sell prices being the most recent buy or sell trade price, found either via a dummy trade or where that’s not possible with a sell, at the price sell trades were going through at the time of the post.

The idea was for it to be a conservatively run Investment Trust portfolio suitable for cautious investors. Stake sizes started at £2500 in 2016 and where the stake size is lower it’s because of top slicing or selling enough to run the rest for free. e.g Fidelity China Special Situations (LON:FCSS)and BlackRock World Mining Trust (LON:BRWM). Later stake sizes were often £2000.

As you can see there’s a wealth of facts and figures brilliantly presented there. The final profit and loss column includes dividends. The portfolio has gained 90% since inception. It did reach a tad over 100% gain in late 2021 and again in 2022 before the current very weak spell for Investment Trusts and ever widening discounts to NAV. So after just 6 years it had been possible to take out the original stake and then run the whole portfolio for free.

Note too how dividends sometimes give performance a big boost. e.g the capital gain for my favourite REIT Aew UK Reit (LON:AEWU) is modest after big share price fall from the peak, but the overall gain thanks to the 13% dividend yield at the 62p buy price is now a very useful 100%. I bought my AEWU stake then and also have that 100% gain. The dividend yields for each Trust as shown by number33 are the yields at the current share price.

Also note VinaCapital Vietnam Opportunity Fund (LON:VOF) bought in 2020 an underperforming VietNam Holding (LON:VNH) ( also in the portfolio ) now. It too is up almost 100%. Both are likely to prove great long term lockaways with promotion from Frontiers Market to Emerging Market status ahead. That should see far more investing in the 3 Vietnam Trusts.

As can be seen from the “relative value from launch” chart this portfolio has managed to outperform the FTSE100, 250 and AIM indexes, except over the last 12 months. There was a period of significant outperformance in 2021 and 2022 but since then the for so long unloved FTSE100 has woken up whereas this portfolio decided to disappoint!

(Note too the dire performance from the AIM index but with signs at last that recovery has started. That would be good news for followers of by far the most popular thread here, the daily small company updates and superb analysis from Paul Scott and Graham Neary).

On the “total return” chart, the blue is the profit and the black shows the dividends. Red shows the loss…..but fortunately red is only a small loss for just 2of the holdings. The “value change this week” in blue near the top shows the weekly gain or loss for each Investment Trust.

Note too near the bottom left of the portfolio , the weekly %age gain or loss for the FTSE100 and near the top in blue the weekly cash gain or loss and percentage weekly loss for this portfolio.

Overall performance is NOT eye catching. That reflects the inevitable poor investment buy decisions but also that at times I tended to neglect this Investment Trust portfolio when I became arguably too obsessed with finding and posting on and buying bombed out UK value shares instead. e.g shares like Legal & General (LON:LGEN) , M&G (LON:MNG) , Aviva (LON:AV.) and plenty of others where the still very big dividends reflect how cheap the share STILL is.

More recently this portfolio did get full attention but the performance of buys over the last year or so have disappointed…..so far! Some still look excellent value and fwiw I’m happy with every holding in this portfolio.

Comments including criticisms and suggestions very welcome.

Mon 3:43pm

Just received this update on Chile https://www.investchile.gob.cl.... Blackrock Latin American Investment Trust (LON:BRLA) have 4% of assets in Chile. There is an ETF iShares MSCI Chile (ECH), but not sure if it can be bought in UK.

Scotty020

Mon 4:27pm

Tritax EuroBox (LON:EBOX) interesting update. Extended the timeline & sounds like might have shaken a few other interested parties. Hopefully the outcome is strong for holders (myself incl!)

Mon 6:39pm

The Tritax EuroBox (LON:EBOX) RNS bid update was at 4.30p.m.

This bit of the update confirms there are several potential bidders, so the chances of successful EBOX bid seem high.

“In addition, the Board confirms that, following the announcement of Brookfield's possible cash offer on 3 June 2024, it is in discussions with a number of parties from whom it has received and/or solicited expressions of interest regarding a possible offer for the Company. The Board has also provided such parties with access to due diligence information.”

At what price?

Latest NAV was 82.4p. A bidder won’t want to pay more than a 10% discount price surely? So probably 70p minimum and 75p maximum. Well worth continuing to hold now and await events.

I hold Tritax EuroBox (LON:EBOX) and several other big dividend paying REITS that are mostly on big NAV discounts. Good chance there will be further sector bids and amalgamations ahead……and while we wait there’s rhst very useful dividend income.

Mon 6:47pm

As well as the REITS worth holding or buying, Vietnam Trusts remain very tempting. I hold both VietNam Holding (LON:VNH) and VinaCapital Vietnam Opportunity Fund (LON:VOF) and have held both for most of this Century and they’ve proved to be fabulous investments. Both have more than quadrupled just in the last 10 years and gains are bigger still over longer timespan.

VietNam Holding (LON:VNH) is on a small discount and VinaCapital Vietnam Opportunity Fund (LON:VOF) on a still too wide and undeserved 20% NAV discount.

Here’s Quoted Data on VietNam Holding (LON:VNH)

Vietnam Holding Limited - Update from QuotedData

12th June 2024

Stellar performance with plenty of potential

Vietnam Holding (VNH) has provided strong absolute and relative returns during the last 12 months, expanding its record of outperformance of both peers and relevant benchmarks.

The introduction of a share redemption opportunity at net asset value (NAV) less associated costs (the first of which is on 30 September this year - see page 21) has significantly narrowed VNH's share price discount to NAV so that a 25.7% NAV return translated into a 48.2% share price return over the 12-month period ended 31 May 2024.

However, with strong growth drivers still in place (see page 5) and attractive valuations, there could be lots more to come. We think that as current headwinds abate and become supportive tailwinds, VNH could shift to trade at a premium to NAV and be in a position to issue stock, with the benefits of increased efficiency (this should put downward pressure on its ongoing charges ratio) and liquidity that would bring.Full Research:

https://quoteddata.com/research/vietnam-holding-limited-stellar-performance-with-plenty-of-potential-qd/

This research is also available free on our website www.quoteddata.com where you will also find news, performance data and factsheets on every London listed Investment Company. QuotedData writes and distributes research on a number of quoted companies, facilitates meetings between those companies and existing and potential investors and assists in raising additional capital where required.

NB: Marten & Co was paid to produce this note on Vietnam Holding Limited, and it is for information purposes only. It is not intended to encourage the reader to deal in the security or securities mentioned in this report. Please read the important information at the back of this note. QuotedData is a trading name of Marten & Co Limited which is authorised and regulated by the Financial Conduct Authority. Marten & Co is not permitted to provide investment advice to individual investors categorised as Retail Clients under the rules of the Financial Conduct Authority.

QUOTEDDATA
50 Gresham Street | London EC2V 7AY
Tel: +44 (0) 20 3691 9430

www.quoteddata.com | @quoteddata.com">research@quoteddata.com | www.martenandco.com

And here’s the latest VietNam Holding (LON:VNH) overall bullish monthly report:-

https://www.vietnamholding.com...

And here’s the latest VinaCapital Vietnam Opportunity Fund (LON:VOF) Monthly Report. It begins with the sad “In Memorium” section about the sad and sudden death of lead Fund Manager Andy Ho.

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

The Monthly Reports are always worth reading. Note this bit:-

“ Vietnam’s earnings growth and valuations remain attractive
Nevertheless, Vietnam’s stock market remains attractively valued for investors confident in its long-term growth
potential. Current market valuations are appealing, with the forward P/E ratio of 11.5x for 2024, which is about 20%
lower than regional peers and one-standard deviation below the market’s historical average.

Based on our in-house
Research team’s analysis, the market’s earnings growth for 2024 and 2025 is expected to rebound from an earnings
contraction in 2023 to 15-20% average growth annually for the next two years. Given the market’s attractive valuation
and strong earnings growth outlook, it is trading at a PEG (price/earnings-to-growth) ratio of less than 1x, which indicates
the market’s attractive value.

So even though both VinaCapital Vietnam Opportunity Fund (LON:VOF) and VietNam Holding (LON:VNH) have rocketed since listing, there could well be a lot more to come.

Others also worth a look include the 3 Mining Trusts BlackRock World Mining Trust (LON:BRWM) CQS Natural Resources Growth and Income (LON:CYN) and Blackrock Energy and Resources Income Trust (LON:BERI) . High chance of a big Mining Sector bull market ahead on “green/renewables” demand amid supply shortages.

China if willing to take the political risk. Fidelity China Special Situations (LON:FCSS) at 201p is down 60% from the peak and Jpmorgan China Growth & Income (LON:JCGI) at 218p is down 75% from 840p peak, so for both there’s a lot of bad news now priced in.

International Biotechnology Trust (LON:IBT) also worth checking out along with others in Biotech sector.

Happy to provide further reasons if asked.

Mon 8:04pm

I am still watching China having bought and sold HSBC MSCI China UCITS ETF USD (LON:HMCH) at a profit recently. But there will be a time to buy- the market has pretty much halved since 2021.

Mon 8:10pm

What other REIT's do you have put off interest Ken? I hold Schroder Real Estate Investment Trust (LON:SREI) & Supermarket Income REIT (LON:SUPR) on top of Tritax EuroBox (LON:EBOX) and will look to add given the attractive discount.

I have Aew UK Reit (LON:AEWU) on the watchlist to look into further when I get the time

Brilliant Leader

Tue 6:30am

Jpmorgan Global Growth & Income (LON:JGGI) announcing a 23% increase in its annual dividend mirroring a strong investment performance over the preceding 12 months. This is the ninth consecutive dividend increase since adopting this enhanced dividend policy in 2016. As I’ve said on Twitter/X it’s a great model as long as investment performance is strong. It’s also my largest holding.

Tue 9:23am

Scotty.

I hold these REITS:-

Aew UK Reit (LON:AEWU) (the best performer and doubled with dividends included since I bought in 2020). Their Results are out today. I’ve only scanned them so far but they look OK but no share price reaction. Discount is narrower than most at 12% but dividend held for 34 quarters is 9%.

Alternative Income REIT (LON:AIRE) 16% discount and 8.6% dividend. It’s too small really and not sure whether that increases or decreases the chances of it falling to a bid or amalgamation.

Schroder Real Estate Investment Trust (LON:SREI) 28% discount and 7.2% dividend. Dull performer but a chance it will join in sector consolidation.

Supermarket Income REIT (LON:SUPR) 20% discount and 8.5% dividend. Supermarkets are solid Companies to be renting to.

And I also hold these 3 Commercial Property Europe Trusts:-

Schroder European Real Estate Investment Trust (LON:SERE) 40% discount! And 8% dividend .

Phoenix Spree Deutschland (LON:PSDL) as a risky punt and not a quality big dividend paying REIT like the others. 47% discount.

Tritax EuroBox (LON:EBOX) Recent events well covered on these threads. Not a lot of upside from 64p as a bid likely to be around 70-74p so it paid to be in when it was covered here as low as 49p. With several interested there’s a high chance there will be a successful bid …..to give at least 10% further upside.

Tue 9:30am

Thanks a lot, will have a look into couple of these!

Tue 10:17am

I agree- hold JGGI.

Tue 11:43am

Regional REIT (LON:RGL) Executive interview. If to be believed it would be worth taking up rights. Certainly the balance sheet will be improved and LTV down to 40%. But it did sound like they senior debt was getting close to the covenants regarding LTV ratios. I will be taking up my rights-unless something comes out post election on Thursday that could affect the property sector RGL operate in https://www.edisongroup.com/ed...

Tue 4:04pm

Overall encouraging Results from Aew UK Reit (LON:AEWU) today. They are seeing green shoots and better prospects and dividend cover has gone up to 91% from previous 73%. So the risks of the big dividend being cut are now significantly reduced. Aew UK Reit (LON:AEWU) was the only REIT that didn’t cut the dividend in the covid falls.

A negative not mentioned by any of the REITS yet afaiaa is that inflation risks are increasing again as the awful Middle East war continues and risk of West Bank escalation, and that might mean the interest rate cuts that would really set the REIT sector alight might not happen, or just one small cut ahead this year.

Big plus for the sector remains bids and amalgamations so it looks well worth holding on to any REITs we hold in case one of ours is the next target.

Not sure about Regional REIT (LON:RGL) now. I’ve watched it all from the sidelines. There’s a chance of a good buy opportunity after the indigestion of so many new shares in issue that might see a falling share price post full completion of the open offer. At best (like Phoenix Spree Deutschland (LON:PSDL) ) a punt with that focus on Office but if the share price falls far enough is it worth a go?

Finally away from REITs Amedeo Air Four Plus (LON:AA4) announced the next 2p quarterly dividend today. Ex div on July 11th and pay day about July 31st. It seems nobody else here shared my enthusiasm when posting with the share at 40p (now 44p) , despite 20% yield at that price. That dividend will continue at least until 2026 and should support a share price floor around 40p for a while yet.

Investment Trust- Thoughts (July 2024)

Investment Trust- Thoughts (July 2024)

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Charles Mitchell

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