Investment trust insider on Saba and Edinburgh Worldwide – James Carthew: ‘Saba has too much capital and is running out of targets’
Saba needs to take a chill pill, stop obsessing over asset gathering, and think more about the long term rather than making a fast buck.
There has been much speculation about Saba coming back for a second go at what is left of its original list of targets and we now have confirmation of that with the planned requisition meeting to oust Edinburgh Worldwide’s (EWI) directors and replace them with Saba’s stooges.
Given how badly Saba’s attempt to seize control of EWI and its other targets went earlier this year, you might have thought that their argument would have evolved beyond: ‘performance is bad, hand us the keys to the castle’. However, apparently not.
Once again, their initial argument is about the trust’s performance relative to some seemingly randomly selected but entirely unsuitable benchmark. In this case it quotes the trust’s returns over a five-year period (end date unspecified but I think it was to the market close on around the 24th or 25th of this month).
It compares that to the FTSE All-Share Index, saying that EWI has selected this as a benchmark. A quick glance at the factsheets demonstrates that the company’s choice of performance benchmark is actually the S&P Global Small Cap index, which is more representative of its portfolio…. read more here