The Monks Investment Trust
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WhatSupplement February 2021 Investment TRUST A ONCE IN A LIFETIME CHANCE Nine opportunities to pick up promising trusts that you will not want to miss out on Gresham House’s Richard Staveley talks investment philosophy; and TEMIT’s Chetan Sehgal on innovative EMs THINK: GROWTH If you’re thinking about your future, • 3 long-term growth trends drive our research think Martin Currie Global Portfolio Trust. • World-class sustainability ratings Our specialist team hand pick stocks with a focus on Find out more at martincurrieglobal.com long-term growth drivers, offering investors access to a Capital at risk. Values can go up and down. We do not target diversified portfolio of between 25 and 40 of the world’s particular sustainability outcomes. leading companies. Sustainability Rating: Martin Currie Investment Management Limited, registered in Scotland (no SC066107). Registered office: Saltire Court, 20 Castle Terrace, Edinburgh EHES. Authorised and regulated by the Financial Conduct Authority. Please note that calls to the above number may be recorded. Tel: 0808 100 2125 www.martincurrie.com © 2020 Morningstar, Inc. All rights reserved. Morningstar Rating as of 22-12-20. GPTpressAds2021.indd 2 05/01/2021 10:47 THINK: GROWTH If you’re thinking about your future, • 3 long-term growth trends drive our research think Martin Currie Global Portfolio Trust. • World-class sustainability ratings Our specialist team hand pick stocks with a focus on Find out more at martincurrieglobal.com long-term growth drivers, offering investors access to a Capital at risk. Values can go up and down. We do not target > diversified portfolio of between 25 and 40 of the world’s particular sustainability outcomes. >| CONTENTS: FEBRUARY 2021 | LEADER leading companies. Sustainability Rating: 4 COVER STORY BUYING INTO NEW MANAGEMENT Nine opportunities you will Lawrence Gosling is on the lookout for not want to miss out on managers applying old skills to new trusts Back in December our Investment Trust supplement was 10 EMERGING MARKETS titled Trusts for 2021 and beyond. In that edition, we selected a EMs have had a ‘good group of investment companies which we thought provided very good long-term buying opportunities. pandemic’, offering resilience, Many of these suggestions were based on the big discounts the trusts were opportunity and leading-edge trading on, which essentially allows investors to buy in cheaply in the hope or expectation that the discount will narrow. innovation For readers who are still not too familiar or comfortable with this strategy, it is the same as buying shares in a single company because you believe the 12 INTERVIEW share price is currently depressed for a reason; but the long-term outlook is very good. Gresham House’s Richard With an investment trust although you are buying a single share in the Staveley answers questions trust, the trust owns shares in dozens of other companies and each of those is not always fully valued. So you are buying shares in the sum of the parts about his investment cheaper than the true value should be. philosophy and outlook Looking back at some of those recommendations two of the trusts have reduced their discount already. The former Patient Capital Trust managed by Woodford Investment Management, which has been renamed as the 14 ASIA Schroder UK PPT, has seen one of its holdings getting a bid which has seen a nice rise in the share price. A beacon of stability in a Equally the very different India Capital Growth fund, a trust which invests world of disruption in small and mid-cap companies in India, has seen its discount come in from around 40% in the summer of last year to around 10% or less currently. In this supplement we are looking at trusts where the discount is not 16 DATA the big driver for buying into the trusts, it is the long-term skill of the fund managers and their track records which will be applied to new trusts they Morningstar data covering the have taken over. performances of investment Two of the trusts are managed by the excellent Troy Asset Management. Troy Income & Growth Investment Trust has an excellent long-term record trusts over six months, one and is very suited to the investing environment we are in; while Securities year, three years and 10 years Trust of Scotland is a trust it only took over the management of in the autumn of last year, so investors would be buying into the recovery cheaply. RWC, an excellent boutique, took over the Temple Bar investment trust at a similar time and there has been a good uplift in the share price and narrowing of the discount to the point where the shares have traded at a narrow premium. Murray Income, managed by Aberdeen Standard Investments, subsumed the Perpetual Income & Growth Investor late last year, which is a good trigger to look at the enlarged trust. We also asked the manager of the Wise Multi- Asset Growth trust for his suggestions, one of which, Odyssean, is a trust we like. We hope you find the selections of interest. T Martin Currie Investment Management Limited, registered in Scotland (no SC066107). Registered office: Saltire Court, 20 Castle Terrace, Edinburgh EHES. Lawrence Gosling is the editor-in-chief of What Investment. Authorised and regulated by the Financial Conduct Authority. Please note that calls to the above number may be recorded. Tel: 0808 100 2125 www.martincurrie.com www.whatinvestment.co.uk What Investment TRUST February 2021 3 © 2020 Morningstar, Inc. All rights reserved. Morningstar Rating as of 22-12-20. GPTpressAds2021.indd 2 05/01/2021 10:47 >| COVER STORY THE FALLOUT FROM COVID-19 HAS CREATED ‘ONCE IN A LIFETIME’ BUYING OPPORTUNITIES. WE IDENTIFY NINE OF THESE OVER THE NEXT FOUR PAGES DON’T MISS OUT By Lawrence Gosling This gives Odyssean a varied management, for the Temple Bar collection of investments where Investment Trust the catalyst is For the purpose of this piece we normally it gets into a holding quite simply a change of fund like five investment trusts which early and has to wait for some manager. I think are worth investors activity to realise that value. The The management was taken looking at, not just as short-term last 12 months has seen more over by Ian Lance and Nick investments but realistically for than normal, but there is clearly Purves of RWC Partners back at least the rest of this decade. more to come. in November and immediately In their own way each of the shares saw a considerable them is worth consideration Murray Income bounce, partly because of the because, in the words of our At the other end of the scale is announcement of the first other contributor, Vincent Murray Income, managed very covid-19 vaccine but also Ropers, who is the co-manager successfully by Charles Luke at because professional investors of the Wise Multi Asset Growth Aberdeen Standard Investments. like the value style of investing fund, they offer an “exceptional It is worth looking at now the pair have used successfully opportunity”. because back in the autumn over the last two decades. His selections are also based it took over the Perpetual There is much debate about on the discounts of the shares Income & Growth Trust value versus growth businesses to the value of the assets; ours which significantly increased and the pair employ a very are not as cheap, but, equally, the combined trusts’ under simple analysis of what the quality is sometimes more management to over £1bn. intrinsic value of a company expensive, but over the long The advantage here is that might be. A great example in the term is worth paying for. it means more index funds trust is Royal Mail, where the have to buy shares and some shares hit £1.20 at the low yet in Odyssean of the bigger wealth managers early January were £3.50. One trust we agree with Ropers have been buying shares as an Lance had bought last year, about is Odyssean’s UK smaller alternative to one or two of the not at the low but when the companies trust which we other comparable trusts. market cap was £1.6bn; and touched on in the early Luke has a very yet by Temple Bar’s analysis its part of last year before simple, understandable European parcel business was covid-19 took hold of style of looking for worth considerably more than markets. In that time the good quality companies that. trust has had bid activity Quality is sometimes at a decent price and Lance talks about the for six of its companies more expensive, but he tends not to be a rotation from growth towards which is a great example big trader. Looking at value companies in the main of fund manager Stuart over the long term is Murray Income’s longer magazine and I tend to agree Widdowson’s approach. worth paying for term performance is a with him. We are starting a long- He analyses good way to see how term appetite for these kind of companies with his the enlarged trust could companies. colleague using the perform over the next metrics which private five to 10 years. Troy equity firms use – essentially To show the difference in seeing how cash a business Temple Bar opinion between funds it’s fair to generates and looking at what If Murray Income is worth say Troy invests quite differently their future opportunities might considering because it has but is equally appealing. be. increased its assets under There is something very 4 What Investment TRUST February 2021 www.whatinvestment.co.uk >| COVER STORY reassuring about the way Troy Asset Management manages money which resonates with the environment we find ourselves in.