Lauren Hardy, Portfolio Adviser, 22 August 2024:
Investors in the Rights and Issues investment trust (RIII) “should be increasingly optimistic” about its future prospects, according to the research team at QuotedData, following a 33% total return over the last year and its “stable” continuity plans following Dan Nickols’ (pictured) retirement in July.
RIII, which is benchmarked against the FTSE All Share but invests predominantly in UK mid and small caps, has struggled over the last three years given the previous unfavourability of British smaller companies. According to AIC data, the trust returned only 2.3% over the period, although this is a significant outperformance of its sector average, which is down 13% over the same time frame.
Now, with improved economic prospects for the UK, and a succession plan decision which was made with “continuity front and centre”, QuotedData said the outlook for the trust appears “much brighter now”.
“This positivity is reflected in the recent performance of the trust, which is up 33% over the past 12 months thanks to strong growth across the portfolio, the expectation of falling interest rates, and refreshed optimism around the UK’s political stability,” the team explained.
“Against this backdrop, the retirement of co-manager Dan Nickols (pictured) was announced. At the beginning of July, co-manager Matt Cable took on a lead manager role, supported by Tim Service (head of Jupiter’s SMID team). The decision was made with continuity front and centre and reflects the more stable environment that the trust now finds itself in, having successfully navigated the challenges of the past few years.
“Reflecting the return to form, RIII investors should be increasingly optimistic about the trajectory of the fund going forward.”
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