Investment Trust- Thoughts (March 2025)

1st Mar by Charles Mitchell

227 comments 8084 reads

Investment Trust- Thoughts (March 2025)

Links to older monthly thoughts-reader request.

February 25 January 2025 December. November October

September August July June May April March February

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.

February2025 Investment Trust monthly performance.

Top 10 Equity only

Crystal Amber Fund (LON:CRS) +22.5%

Baillie Gifford China Growth Trust (LON:BGCG) +18.8%

BBGI Global Infrastructure SA (LON:BBGI) +18.7%

SVM UK Emerging Fund (LON:SVM) +15.8%

Fidelity China Special Situations (LON:FCSS) +14.9%

Jpmorgan China Growth & Income (LON:JCGI) +13.8%

Seraphim Space Investment Trust (LON:SSIT) +11.3%

Invesco Global Equity Income Trust (LON:IGET) +9.6%

Henderson International Income Trust (LON:HINT) +9.5%

Barings Emerging Emea Opportunities (LON:BEMO) +9.2%

Bottom 10 Equity Only

JPmorgan US Smaller Companies Investment Trust (LON:JUSC) -14.2%

Edinburgh Worldwide Investment Trust (LON:EWI) -11.1%

Canadian General Investments (LON:CGI) -11.1%

Jpmorgan Indian Investment Trust (LON:JII) -10.5%

Sure Ventures (LON:SURE) -10.3%

Bellevue Healthcare Trust (LON:BBH) -8.5%

VietNam Holding (LON:VNH) -8.1%

Schroder Oriental Income Fund (LON:SOI) -8.1%

Ashoka India Equity Investment Trust (LON:AIE) -7.3%

Top 5 All Funds

Crystal Amber Fund (LON:CRS) +22.5%

Baillie Gifford China Growth Trust (LON:BGCG) +18.8%

BBGI Global Infrastructure…

Unlock with Email

Unlock with Google

Already have an account?
Login here

boringchess

28th Mar

I have exited this morning at 109.5p. Just too close to the purchase price to justify staying in any longer.

Orthodon

Thanks Lincs - that makes sense. Slightly concerned by the volumes going out from big holders at these important times for Crystal Amber Fund (LON:CRS) but at least it’s no almighty dump.

ken mitchell

Orthodon.

Is it wiser to focus on the investment case for Investment Trusts rather than trying to get to the bottom of big buys or sells?

With Crystal Amber Fund (LON:CRS) what’s crucial shorter term is the bid or otherwise for De La Rue (LON:DLAR) and the completion or not of the agreed sale of their Authentication .business. That was all covered in my post covering the case for buying Crystal Amber Fund (LON:CRS) and/or De La Rue (LON:DLAR) .

De La Rue (LON:DLAR) share price is steady with no falls hinting that the sale might not complete.

Then what matters is further positive news about the largest CRS holding, Morphic Medical.

When I have doubts I look again at the most recent (CRS) update. I.e their recent Results, especially so in the case of CRS the excellent commentary. CRS Results were on the 21st March. So perhaps have another look there?

I’ve held De La Rue (LON:DLAR) for a good while and recently bought Crystal Amber Fund (LON:CRS) too.

Charles Mitchell

29th Mar

Trusts on Investor Meet Company this week.

VINACAPITAL VIETNAM OPPORTUNITY FUND LTD VinaCapital Vietnam Opportunity Fund (LON:VOF)
Interim Results
31st Mar 2025 at 10:00am BST

TARGET HEALTHCARE REIT PLC Target Healthcare Reit (LON:THRL)
Interim Results to 31 Dec 2024
1st Apr 2025 at 10:00am BST

CT PRIVATE EQUITY TRUST PLC CT Private Equity Trust (LON:CTPE)
Q4 NAV update and Full Year Results for 2024
2nd Apr 2025 at 10:30am BST

PANTHEON INFRASTRUCTURE PLC Pantheon Infrastructure (LON:PINT)
Annual Results 2024
4th Apr 2025 at 12:00pm BST

I realise most reading posts here won’t be bothered about the latest nonsense on buybacks I’m about to post. Understandably most of us just want posts where we help each other find winning Trusts to buy.

But on the off chance that any Investment Trust Managers see these threads here goes! THE most stupid buyback ever imo features in the last section of this post.

I’ve posted before how a very large number of Trusts are buying back their shares and are doing so to try and reduce the too big (as the Managers see it) discount to NAV their Trusts shares are trading at.

Generally it’s not working, with too often the discount widening even more. Despite that these Trusts continue spending between them £hundreds of millions in the hope (presumably) that one day the discount might narrow.

I’ve also posted how Pershing Square Holdings (LON:PSHD) have wasted over $1 billion on buybacks only to see the discount stay wide. And Sequoia Economic Infrastructure Income Fund (LON:SEQI) were by far the biggest buy backer in the sector….with Manager admitting that they hadn’t worked as intended and still wouldn’t if they doubled the amount they spent on them. But their commentary claimed it was worth it as “it showed confidence in the business.” That’s a crazily expensive way to show that confidence surely?

Now to the most stupid explanation so far to justify failing buyback policy. It’s from VinaCapital Vietnam Opportunity Fund (LON:VOF) in their Results comment on Thursday. The following is the section from their comment on their buybacks:-

“In common with much of the closed-end fund sector, the discount was under significant pressure for the period under review. The Board uses share buybacks as the principal tool for managing the discount and, as the discount widened, the Board stepped up the buybacks to provide liquidity to selling shareholders and to minimise the volatility.

Over the six months to 31 December 2024, approximately 8.6 million shares were bought back, which was 5.7% of the shares in issue at the start of the period at a cost of USD50.9 million. The discounts at which shares were bought back resulted in an increase in the NAV of some 10.6 cents per share to the benefit of continuing shareholders.

Since the period end, and up to 20 March 2025 the Company has spent a further USD24.4 million buying back shares in the market. The buybacks have not reduced the discount, but they have maintained liquidity in the market. The Board aims to maintain a balanced approach. In an ideal world we would be buying shares in Vietnam, not selling them to fund buybacks of our own stock.

We continue to believe strongly in the long-term potential of investment in Vietnam and the benefits of the Company's unique approach to investing and will continue to use share buybacks where we believe that these are in the best interests of shareholders.”

SO!!

1. They admit their big buybacks have failed to reduce the discount, but justify them by saying that “they’ve maintained liquidity in the market.” What a crazily expensive way to do that.

2. Note the bonkers decision to double up the buybacks because up till then they hadn’t worked! If something we do doesn’t work stop doing it, don’t double up. Surely that’s basic common sense?

3. Then there’s this extraordinarily stupid comment:-

“In an ideal world we would be buying shares in Vietnam, not selling them to fund buybacks of our own stock.”

Surely investing in Vietnam Companies is what this Trust (and what the many other Trusts buying back in other sectors) should be doing. I.e investing it in the business by buying investments and not throwing those many £millions away on buybacks they admit are not working?

When will these Trusts and those who advise them and commentators who seem blind to the obvious, that so often their buybacks are not beneficial to their shareholders as VOF Managers think. They are far too often a waste of money.

ShoeShineBoy

30th Mar

Ken,

you make valid points but I suspect you will get more feedback if you were to write to the AIC or to individual trust managers. The downside is this could become a lot of work for you personally.

I'm attending Mello Chiswick at the start of June and again I'm thinking of asking Christopher Mills again why the discount on North Atlantic Smaller Companies Investment Trust (LON:NAS) is so wide. When I asked this question a couple of years back, I got a short answer saying the focus is on growing the NAV but this hasn't happened either. In CM's defence, maybe 3 years much of a time frame ? Although the discount on North Atlantic Smaller Companies Investment Trust (LON:NAS) has been going on for a lot longer than that.

It's odd that some trusts were able to operate an efficient discount control mechanism until Covid but then it seemed to go wrong and they haven't recovered. Quite mainstream trusts as well such as Finsbury Growth & Income Trust (LON:FGT) and Capital Gearing Trust (LON:CGT). I'm not saying it's related to Covid directly, it just seems to be the timeframe it has happened in.

Finsbury Growth & Income Trust (LON:FGT)

Capital Gearing Trust (LON:CGT)

Capital Gearing Trust (LON:CGT) this last week got approval from shareholders to continue to buy back up to 15% of the share capital. £130m so not a small number. But as you say, will it have any effect ?

Perhaps we will see investment trust discounts narrow as the amount of money flowing into US stocks and particularly the Mag7 slows down and maybe reverses IF this trend continues ? US markets are so deep and liquid that there is almost certainly a Mag7 mk II waiting to take over from Apple, Alphabet etc...

https://tinyurl.com/svf5zfue

But then again, maybe investment trust discounts are part of a wider UK problem ? Certainly some of the responses on Megan's Spring Statement article seem to suggest people think the UK is in terminal decline ? Sad but what great new companies are we seeing ? And almost no IPOs.

And all overseen by the London Stock Exchange (LON:LSEG), who care more about Refinitiv data sales than UK listing sales. I'm sure I recall David Stredder saying he invited The London Stock Exchange (LON:LSEG) to Mello before but they declined. I think to myself why ? Because they don't care about retail investors or the wider UK economy, they have Refinitiv data sales to protect.

As a final thought on discounts, maybe Jonathan Davis is the right contact to reach out to ? He certainly interviews a lot of trust managers. But I suspect, having listened to the weekly Money Makers podcast for the last few years, he will agree with you that a lot of money has been wasted on buybacks.

SSB

Good and helpful suggestions ShoeShineBoy. I’ll reply when I get time later today, including on North Atlantic Smaller Companies Investment Trust (LON:NAS)…..it’s not even a subscriber to AIC and nor is its largest holding Oryx International Growth Fund (LON:OIG) . Hmmmm.

Threepeat

Hello Charles and Ken

A question please

Where can I obtain an up to date NAV discount graph for a certain IT. I know ITs report the NAV daily but what I am really looking for is a website that shows a daily graph so that I can see if the discount to NAV is at a high or low historically over the last year or 2 years or so.

If this topic has been covered elsewhere I apologise and if so a link would be Ultra helpful

I have looked at Morningstar but there appears to be too much info

Thanks

Steve

KevinS1

Hi Ken,

I don't mind so much buybacks taking place when the SP is depressed and at a decent discount - at least we are getting a higher NAV per share.

I agree, there can be times when buying back shares at stupid prices is flushing money down the drain.

Hopefully VinaCapital Vietnam Opportunity Fund (LON:VOF) will start to show some strength over the next few months.

Best wishes. K

Try the AIC website - it has excellent data for 95% of all IT's with loads of different info. For a very quick look I use the HL website which will show you the NAV compared to the SP and also in the table next to it it will show you the average over the last 12mths vs the current discount.

Word of warning with HL share-price tables (for returns over 6mths, 1yr, 3yr, 5yrs etc - they are SP returns only (not total return). You need to click onto the performance tab to get TR which includes divis etc.

Hi Threepeat,

not every trust calculates it's NAV on a daily basis. Trusts that are invested in equities do tend to have a daily NAV but infrastructure and private equity for example have monthly or quarterly NAV calculations. Why ? Because the underlying assets are less liquid. I recall Alastair Lang being interviewed on the Money Makers podcast and he made the point of investors understanding the discount.... "discount to WHAT ?" is how he phrased it. Retail investors need to understand how the NAV is calculated and how often.

So, to go back to your question, you can see the NAV calculation frequency on the AIC web site (the official source: https://www.theaic.co.uk/) or the HL web site; the latter has a good graph for each trust showing the share price and the NAV. It makes understanding the premium or discount to NAV very obvious. Lindsell Train Investment Trust (LON:LTI) is a nice example because of the temporary high premium to NAV. The manager even said at the time (around 2018/19) that investors should not buy the trust because it was trading at such a high premium to NAV).

https://www.hl.co.uk/shares/sh...

It also gives you an understanding of how often the NAV is calculated.

Of course, to understand HOW the NAV is calculated, you need to refer to the annual report or half year report ie: the underlying assumptions etc. This can get tricky for infrastructure or private equity.

Hope that helps.

I don't recall seeing this on Charles' thread so I will try to cover here: The AIC Dividend Heros list was updated a couple of weeks back. These are trusts that have increased their dividends for 20 years or more.

https://tinyurl.com/4xe4bc9b

And it got covered in this podcast interview with Nick Britton, Research Director at the AIC.

https://tinyurl.com/mvtvhex4

SSB thoughts:

# The list is made up of equity based trusts. Particularly UK equity trusts. Renewables and infrastructure trusts have not been going long enough but I do wonder how many will be on the list in a few years time. Equities just seem more reliable.

# Some of the trusts have very small yields that I personally think are not really worth having and the share prices are starting to turn south eg: Bankers Investment Trust (LON:BNKR) and Alliance Witan (LON:ALW) because they have significant holdings in the Mag 7.

# I hold Caledonia Investments (LON:CLDN) but not for the dividend. It's up +13% over the last 12 months and +62% over the last 5 years. Almost £2bn mkt cap, it's a well run trust with global exposure.

# Global Smaller Companies Trust (LON:GSCT) doesn't get much discussion on this board. I don't know much about it. When I use the AIC screener on AIC sector "Global Smaller Companies", Herald Investment Trust (LON:HRI) comes out better over a 10 year time frame. Btw, I notice the discount on Herald Investment Trust (LON:HRI) has opened up again post SABA vote! Just saying :-)

# And F&C Investment Trust (LON:FCIT) is also on the list. Launched in 1868, mkt cap of £6bn but coming off a little now as the top 10 contains the Mag 7. Having said that, it has almost doubled in price over the last 5 years.

# Jpmorgan Claverhouse Investment Trust (LON:JCH) has a high conviction portfolio with the top 10 representing almost 50% of the NAV. Ditto Murray Income Trust (LON:MUT) with around 43%.

# From a personal perspective, I like the look of City Of London Investment Trust (LON:CTY) and Murray International Trust (LON:MYI). The former is well known and invested mainly in FTSE 100; I could be tempted to switch from Edinburgh Investment Trust (LON:EDIN) although this has performed well for me since I bought it back in 2021. The latter is invested globally, 29% in the US but not in the Mag 7 so presumably more value on offer here.

SSB

Hi Kevin

I think you have misunderstood my post, which is my fault for not explaining the key points concisely enough.

I was not posting what’s been posted to death; I.e the case for or against buybacks in general, where yes, if done prudently they can be effective.

My post was specifically on the issue of Investment Trusts buying back to reduce the discount and then continuing with them and even doubling up on them while admitting that they haven’t worked.

And my key point was VinaCapital Vietnam Opportunity Fund (LON:VOF) Manager comment complaining about their own buybacks AND saying they would much rather be spending that money investing in Vietnam instead.

That’s exactly what they should be doing instead of wasting the money on yet more buybacks that they admit have failed miserably. Who is stopping them from investing in Vietnam instead of wasting more money on buybacks?

Hope that’s made it clearer now.

………………….

Finally to one other point. Yes. NAV will increase when Investment Trusts buy back, but it often costs many £ millions just to increase NAV by 1p or so and if the discount to NAV widens then using buybacks to reduce the discount fails, doesn’t it? A successful investment in their portfolio is going to increase NAV far more.

Adding a bit more to your post on the Investment Trusts dividend heroes ShoeShineBoy. A reason why the yields are so surprisingly low for some of the Trusts who have increased the dividend sometimes for nearly 50 years is because that Trusts share price has multi multi bagged over that long period.

Also it can be a bit of a marketing ploy. e.g a dividend increase from 10p to 10.1p keeps up their annual record of increases.

Two 50+ years dividend increasing Trusts still with ok yields are City Of London Investment Trust (LON:CTY) which I hold, and Merchants Trust (LON:MRCH) which I sold recently to fund more tempting buys in the bombed out Renewables Infrastructure sector.

I’ve held Henderson Far East Income (LON:HFEL) another multiple year dividend hero for several years and it has proved a poor Investment (it’s up but only thanks to the dividends) because they have placed too much emphasis on that annual dividend increase, which has been at the expense of capital gains. The yield is now over 10% and IF new Manager and changed investment policy sees improved performance, now is a good time to buy. BUT so far there has not been that improvement so the cautious investor might want to monitor NAV which they report daily, and wait for it going up, before buying.

Thanks ShoeShineBoy for your follow up suggestions (re my buyback post).

I’ll email AIC’s Annabel Brodie-Smith tomorrow and copy to her my post here, and see what comes from that. She was very concerned and was fully aware when I last emailed about Hargreaves refusing Investment Trust buys, but said unfortunately AIC had tried and failed to get H/L to budge.

For the reason you gave (too much hassle and also high chance it would be fruitless I won’t individual Trusts except VinaCapital Vietnam Opportunity Fund (LON:VOF) where again I’ll send my post. Before contacting Jonathan Davis I’ll wait to see what comes from Annabelle first.

Separately did you and other readers here know that Christopher Mills doesn’t subscribe to AIC. It is one of the very few Trusts that doesn’t . It means potential investors miss out on the masses of information AIC provides for every subscribing Trust. And the North Atlantic Smaller Companies Investment Trust (LON:NAS) top holding doesn’t subscribe either.

Why don’t they?? A good question to ask him. The maximum cost to subscribe is only £22,500 . This AIC link covers their charges for Investment Trusts for subscribing Trusts and any wanting to subscribe.

https://www.theaic.co.uk/about...

Thanks again for the prompt and for yet more of your great posts here. There’s so much in them.

re: Trusts who have increased the dividend sometimes for nearly 50 years is because that Trusts share price has multi multi bagged over that long period.

I agree, that makes sense. And that is why we should be interested in total return rather than just a yield. I'm working through my holdings and trying to conclude on whether I can add to any with the spare cash I've got. Conclusion so far is AVI Global Trust (LON:AGT), Caledonia Investments (LON:CLDN) and maybe HgCapital Trust (LON:HGT) but they will be smallish buys just in case.

And likewise, thanks for your many posts, I just about manage to keep up with this board and the DSMR during the week. There are a number of quality posters here, it's well worth the subscription IMO.

Apologies, no more to add. I have run out of time again this weekend!

stevePo

31st Mar

PRS Reit (I hold) Results out today for the six months to Dec 31st. To my inexperienced eye, all looks well with increased revenue and profit. They say that there are offers to buy the company for between the price in Feb (around 110p) and NAV (which they claim is 139p). I would imagine that it is easier to get an accurate NAV for residential property than, for example solar farms or warehouses, but I cannot see how they actually did get the value of these properties. Does anyone know?

Anyway, thanks in advance for any useful help. This is such a good thread.

intuitive6191

Valuing residential property is a little more straight forward than other assets - but not an exact science.

If I was buying a portfolio of rented properties I look at the multiple of rental income for that area. Normally this is somewhere in the region of 10/11 - but can differ considerably region by region.

I would then look at the condition of the property and if it is old/older stock would then factor in a sinking fund for repair.

I would then factor in the level of borrowings if these were needed - bearing in mind we could be looking at higher interest rates in 2026.

Finally I would look at the quality of tenants to assess voids in times of stress. New regulations will mean that it will likely take longer to evict non paying tenants in 2025

As you can see, the above method could produce a different valuation from a standard house price valuation for a normal residential property.

Crystal Amber Fund (LON:CRS) Crystal Amber Fund announces that its unaudited net asset value ("NAV") per share at 28 February 2025 was 187.93 pence (31 January 2025: 185.0 pence per share). Share price is 119.00.

Hi stevePo

I hadn’t looked at PRS Reit (LON:PRSR) until reading your post. I hope you’ve held for a while and enjoyed some or all of the 40% gain from the low last June.

I agree based only on reading the commentary and looking at the figures that their update today looks very reassuring.

Unfortunately for any of us tempted by your post to buy now , it looks like by far the best of the upside has already been had. Successful sector bids have so far mostly been below the quoted NAV. So perhaps maximum upside on a successful bid only 10% or so?

If anyone else here holds or follows PRS Reit (LON:PRSR) they might be able to give you a much better informed reply.

Investment Trust- Thoughts (March 2025)

Investment Trust- Thoughts (March 2025)

Unlock the rest of this article with a 14 day trial

About the Author

Charles Mitchell

227 comments

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

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