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Investment trusts: who's up and who's down in FTSE reshuffle
Infrastructure and emerging market trusts among the winners from the FTSE’s latest shuffle.
The Jupiter Second Split trust is managed by Philip Gibbs, who also manages the Citywire Selection Jupiter Absolute Return fund , which launched to great fanfare, attracting £250 million in its first two weeks. Gibbs also oversaw the Hyde Park Hedge Fund and employed similar hedging strategies in the fund.
The trust has top holdings in the S&P 500 Financial Selector SPDR ETF and bonds in the Altira Group. Its zero dividend shares have a wind-up date of October 2014.
Who’s moving down
The Cazenove Absolute Equity trust dropped off the FTSE Small Cap to be listed on the FTSE Fledgling index and is expected to be wound up at its upcoming AGM as it has continued to trade at what the board is calling an ‘unacceptable discount’.
Kieran Drake, research analyst at Winterflood, comments: ‘Discounts have widened out since 2008 and they have taken measures to reign the discount back in. Probably the reason for the relegation is they’ve bought back a lot of shares through tenders, which reduced the size of the fund and now shareholders are happy to take their investments back.
‘There may well have been conversations behind the scenes as investors have been active in pushing for the wind down of the fund but what’s different from the approach that Laxey have taken with Alliance trust is that they haven’t made anything public and it’s probably because this is a much smaller fund.’
JPMorgan Russian Securities has also been relegated from the FTSE 250 to the Small Cap Index. The trust is currently trading at a 8.7% discount with shares priced at 475p compared with their NAV of 520p. It has given NAV total returns of 40% over the past three years and shed 9% over the past five years.
The Hansa trust has also lost its listing on the FTSE All Share index as a change in rules mean its A-class or non-voting shares no longer warrant a premium listing, though the ordinary share class remains in the FTSE.
James Brown, research analyst at Winterflood, comments: ‘The LSE changed its rules a little while ago so some companies with share classes without voting rights would not be eligible for a premium listing.
‘The Hansa trust is effectively a family office and has two classes of shares. The A shares don’t have any voting rights and the ordinary shares are 52% controlled by William Salomon and his family, so effectively they retain control of the entire trust.’
Ashmore Global Opportunities ($) is another trust that has been ruled out of the FTSE Small Cap and All Share indexes and is trading at a 40.8% discount to its NAV. The trust invests in emerging market special situations. Shareholders rejected a proposed wind up the trust this month.
The exclusion of a trust means it’s still tradeable for investors, but will no longer be included in funds tracking the index.
More about this:
Look up the funds
Look up the investment trusts
- Utilico Emerging Markets (Ordinary Share)
- Raven Russia (Ordinary Share)
- Schroder Asia Pacific (Ordinary Share)
- Worldwide Healthcare (Ordinary Share)
- Advance Developing Markets (Ordinary Share)
- BlueCrest BlueTrend GBP (Ordinary Share)
- GCP Infrastructure Invs. (Ordinary Share)
- Jupiter Second Split (Geared Ordinary)
- Real Estate Credit Investments (Ordinary Share)
- JPMorgan Russian Securities (Ordinary Share)
- Hansa Trust (Ordinary Share)
- Hansa Trust 'A' (Class A Ordinary)
- Ashmore Global Opp USD (Ordinary Share)
- Aberforth Geared Income (Ord Income)
- Duet Real Estate Finance (Ordinary Share)
- HICL Infrastructure Company (Ordinary Share)
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by Matthew Goodburn on Dec 11, 2013 at 00:01