Investment trust insider on shareholder democracy – Carthew: Platforms could still do better as Saba threat to trusts remains
Despite Saba’s resounding defeat against Herald, the challenge of rallying support for upcoming investment trust shareholder votes could still be greater than realised.
I have said it here before, but it bears repeating, that one of the great strengths of the investment companies industry is the power that it puts in your hands as investors. The days when private investors were dismissed as an irrelevance or worse a nuisance are long gone. Now, boards are putting time, money, and effort into communicating with you and canvassing your opinion. Not just because of predators such as Saba, but also because private investors are increasingly the dominant force on share registers.
I am very pleased with last week’s resounding defeat of the proposals for Herald (HRI), but there are six more votes to come, and for the sake of the sector, we need to ensure that Saba wins as few as possible. I would even go so far as to say that, if you were considering voting with Saba because you are fed up with performance or the manager of the trust you hold, think again. Maybe even just sell while discounts are tight or petition the existing board for action. The lack of clarity with Saba’s proposals means that you could end up in a worse situation than you are in now.
However, whichever way you are leaning, please do vote and do it now before it is too late. The 80% turnout for the Herald meeting was good news, but I still wonder what happened to the other 20% on what was an existential vote for the trust. Are holders of 20% of HRI really that apathetic, or was it just too hard for them to make their voices heard?
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