STOCKS | FUNDS | INVESTMENT TRUSTS | PENSIONS AND SAVINGS VOL 20 / ISSUE 19 / 17 MAY 2018 / £4.49 SHARES WE MAKE INVESTING EASIER 14.6% 13.7% 12.7% 12.2% 10.7% COULD YOU GET THREE 6% YIELD INVESTMENT TRUSTS FROM ROYAL BANK TO PLAY THE OF SCOTLAND? RISING OIL PRICE EARLY RETIREMENT: IS IT POSSIBLE ANYMORE? SCOTTISHTHE MONKSMORTGAGE INVESTMENT INVESTMENT TRUST TRUST PLC MONKS HAS OVER £1.5BN IN NET ASSETS UNDER MANAGEMENT, WHILE ITS ONGOING CHARGE IS A MODEST 0.59%*. THE KEY TO A WELL TUNED PORTFOLIO. Monks Investment Trust, we believe, could be a core investment for anyone seeking long-term growth. It is managed according to Baillie Gifford’s £33bn Global Alpha strategy. As a result, Monks takes a highly active approach to investment and its portfolio looks nothing like the index. The managers group their holdings into four different growth categories – stalwart, rapid, cyclical and latent. This allows for excellent diversifi cation and offers the chance to unearth some of the more interesting companies listed on global stock markets. Please remember that changing stock market conditions and currency exchange rates will affect the value of the investment in the fund and any income from it. Investors may not get back the amount invested. If in doubt, please seek fi nancial advice. If you’re looking for a fund to shine at the centre of your portfolio, call 0800 917 2112 or visit www.monksinvestmenttrust.co.uk A Key Information Document is available by contacting us. Long-term investment partners *Ongoing charges as at 30.04.17. All other data as at 31.03.18. Your call may be recorded for training or monitoring purposes. Monks Investment Trust PLC is available through the Baillie Gifford Investment Trust Share Plan and the Investment Trust ISA, which are managed by Baillie Gifford Savings Management Limited (BGSM). BGSM is an affi liate of Baillie Gifford & Co Limited, which is the manager and secretary of Monks Investment Trust PLC. EDITOR’S VIEW ZPG bid highlights appeal of digital platform businesses Look for companies embracing technology to make customers’ lives easier oopla’s parent company ZPG property portal market and executing its (ZPG) was an obvious takeover growth plan with considerable success. Z target and we aren’t surprised to Key to its achievements is the use see it receive a 490p per share bid from of digital channels to easily reach US private equity firm Silver Lake. consumers. That’s also been a real Congratulations if you owned its driving force for many other companies shares before the takeover news was on the stock market including Just Eat announced. And hopefully you did own (JE.), Purplebricks (PURP:AIM) and them, given that ZPG was one of the six Rightmove (RMV). quality stocks we said to buy in the 15 ‘The tech platform model is a special February 2018 issue of Shares following kind of beast: utilising the network the global market sell-off. We said to snap up the effect, automation, and operational leverage to shares at 328.4p, meaning you could have made push towards the winner taking all in the long run, nearly 50% profit in three months if you followed a process that can be accelerated by M&A,’ says our suggestion. stockbroker Peel Hunt. Even if you aren’t celebrating, there are still ‘In the CMA’s decision regarding Just Eat’s important lessons to be learned from the takeover acquisition of Hungryhouse, it described how the situation and the importance of other companies platforms: “offer consumers the convenience of with similar characteristics. choosing from a large range of takeaway providers in one place”. Just replace “takeaway” with car MAKING LIFE EASIER dealers, insurance brokers or jobs.’ ZPG will be the latest company in Silver Lake’s Peel Hunt says that when you are tapping portfolio that uses technology to make customers’ the same broad set of consumer needs via a lives easier. marketplace model, scale efficiencies in tech and Over the past three years ZPG has expanded marketing can easily be made. into the utilities switching market through the Asset manager Lindsell Train believes its best purchase of uSwitch and also developed broader portfolio performers will be companies making propositions in the property and financial services a success of a digital transition or where digital is market. ‘clearly a friend’ to the company. Relevant examples Everything was linked by its goal to help include Euromoney (ERM) and RELX (REL). consumers make smarter property and household decisions. SELECTIVE INVESTING It’s no wonder that ZPG tried to buy Many investors have been put off online platform GoCompare (GOCO) late last year as that businesses due to high equity ratings. And we would have strengthened its position in financial think it is right that there is some scepticism about services, particularly insurance. Although that some of the companies in this market as not bid was rejected, there is now speculation that everyone will be a long-term winner. For example, Silver Lake could acquire GoCompare itself and Purplebricks is arguably trying to do too much at bolt it on to ZPG. once and has considerable execution risk. Yet there is a good argument to suggest some EMBRACING THE DIGITAL CHANNEL of digital players deserve a premium rating if ZPG has been expanding its product lines, holding they have an edge over rivals and the potential up well against increased competition in the to outperform. (DC) 17 May 2018 | SHARES | 3 USING THE Contents PDF VERSION? CLICK ON PAGE NUMBERS TO JUMP 17 May 2018 TO THE RELEVANT STORY EDITOR’S VIEW 03 ZPG bid highlights 18 appeal of digital platform businesses BIG NEWS 06 Could you get 6% yield from Royal Bank of Scotland? BIG NEWS 07 Investors exit emerging markets funds STORY IN NUMBERS GREAT IDEAS 10 BT and other stories 12 Bu y Auto Trader BIG NEWS in numbers as the market 07 Is investor excitement has completely over US gambling misunderstood breakthrough its situation premature? 10 GREAT IDEAS BIG NEWS 14 Red tape is no 08 CYBG refuses to barrier for Ideagen’s elaborate on Virgin growth ambitions Money approach GREAT IDEAS UPDATES BIG NEWS 16 We update on XP 08 Angling Direct is Power and Avesoro a good catch in the retail sector MAIN FEATURE 18 10 funds that outperform again and again securities, derivatives or positions with spread betting organisations that they have an interest in should first clear their writing with the editor. If the editor DISCLAIMER agrees that the reporter can write about the interest, it should be disclosed to readers at the end of the story. Holdings by third parties including families, trusts, IMPORTANT self-select pension funds, self select ISAs and PEPs and nominee accounts are included in such interests. Shares publishes information and ideas which are of interest to investors. It does not provide advice in relation to investments or any other financial matters. 2. Reporters will inform the editor on any occasion that they transact shares, Comments published in Shares must not be relied upon by readers when they derivatives or spread betting positions. This will overcome situations when the make their investment decisions. Investors who require advice should consult a interests they are considering might conflict with reports by other writers in the properly qualified independent adviser. Shares, its staff and AJ Bell Media Limited magazine. This notification should be confirmed by e-mail. do not, under any circumstances, accept liability for losses suffered by readers as a result of their investment decisions. 3. Reporters are required to hold a full personal interest register. The whereabouts of this register should be revealed to the editor. Members of staff of Shares may hold shares in companies mentioned in the magazine. This could create a conflict of interests. Where such a conflict exists it 4. A reporter should not have made a transaction of shares, derivatives or spread will be disclosed. Shares adheres to a strict code of conduct for reporters, as betting positions for seven working days before the publication of an article that set out below. mentions such interest. Reporters who have an interest in a company they have written about should not transact the shares within seven working days after the 1. In keeping with the existing practice, reporters who intend to write about any on-sale date of the magazine. 4 | SHARES | 17 May 2018 Contents EDUCATION 39 How a stock’s 36 liquidity can affect your returns LARGER COMPANIES 40 Why Provident Financial shares are still erratic SMALLER COMPANIES 41 Vertu’s shares look really cheap given its very strong asset backing SMALLER COMPANIES INVESTMENT TRUSTS MONEY MATTERS 42 Next Fifteen’s 26 Three investment 36 Is an early retirement superior performance trusts to play the possible anymore? still has legs rising oil price MONEY MATTERS WEEK AHEAD INVESTMENT TRUSTS 38 How young savers 44 Financial results and 27 Investment can bridge the ex-dividends over trusts exposed to intergenerational the coming week Argentina’s inflation, divide currency and interest INDEX rate problems 45 Index of companies and funds in this issue FUNDS 38 29 The micro cap fund streets ahead of its peers AEQUITAS 32 Four lessons to draw from the year so far WHO WE ARE BROKER RATINGS EXPLAINED: EDITOR: DEPUTY NEWS Daniel EDITOR: EDITOR: We use traffic light symbols in the magazine to illustrate Coatsworth Tom Sieber Steven Frazer broker views on stocks. @SharesMagDan @SharesMagTom @SharesMagSteve FUNDS AND REPORTER: REPORTER: CONTRIBUTORS Green means buy, Orange means hold, Red means sell. INVESTMENT TRUSTS David Stevenson Lisa-Marie Janes Emily Perryman EDITOR: @SharesMagDavid @SharesMagLisaMJ Tom Selby James Crux The numbers refer to how many different brokers have @SharesMagJames that rating.