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Engines of growth: on a bargain hunt

Biotech trust Trump benefit may be shortlived

Engines of growth: on a bargain hunt

By Leonora Walters, Investors Chronicle, 12th October 2020

A key driver of the price of any listed security is sentiment so, not surprisingly, some of the investment trust sectors which have experienced the most extreme discount and premium movements this year are those about which there has been particular concern or hope. In general, there has been more discount widening than tightening over the first 10 months of 2020…

Gavin Haynes, investment consultant at Fairview Investing, says that property investment trusts sectors are a prime example of where there can be great disparity between individual trusts. “You really have to dig down because there will be both winners and losers,” he says…

Private equity investment trusts are also among the sectors to experience substantial downward movements in their ratings..

“Private equity trusts took a real hammering because they over committed [to investments ahead of] the global financial crisis,” says Matthew Read, senior analyst at Marten & Co. “But they are in a better position now and most are not over committed. Some of them are sitting on big cash piles and, as they invest for the long term, a market shocker can lay the foundations for [good investments and performance]. If you take a long-term view it might be a good time to invest in these.”…

Mr Read says that Standard Life Private Equity Trust (SLPE) is also a good way to get diversified exposure to this asset. It was on a discount of 26.4 per cent as of 10 November, tighter than earlier this year but wider than where it has sometimes been in the three prior years.

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