Investment Week, 1 July 2024:
In the latest instalment of the ‘Four graphs explaining’ series, experts discern which investment trusts are actually a buying opportunity amid wide discounts across the sector.
At the time of publication, there are only 23 investment trusts across the entire Association of Investment Companies universe which are on a premium, with the rest running on a discount.
With the majority of the universe effectively ‘on offer’, Investment Week asked experts to highlight which discounts were not a reflection of inherent company issues, but rather the market mis-pricing a decent investment option..
Matthew Read, senior analyst at QuotedData
RIT Capital Partners (RCP) is a large, liquid trust with a well-diversified portfolio, spread across a range of asset classes, both quoted and unquoted, that should grow investors’ capital while protecting against abrupt market moves.
RCP’s private assets held up well in the face of difficult markets and grew as a proportion of the portfolio.
The market then overestimated the negative impact of higher rates on these, widening the discount and, while the NAV has turned the share price still lags.
These are mature, conservatively valued assets.
As RCP executes its plan to reduce its private assets’ weighting, this should bring further NAV uplifts and encourage a re-rating of its shares.
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