Investment trust insider on Caledonia – James Carthew: More juicy dividends would enhance Caledonia’s appeal
Amid all the doom and gloom Caledonia Investments (CLDN) has reported decent results for the 12 months to 31 March that has left its market valuation nudging £2bn.
Over the year the global multi-asset trust generated a total underlying investment return of 27.9%. Despite its broad remit, the board prefers to compare returns to UK inflation and the FTSE All-Share index rather than a global benchmark such as MSCI World. Even with inflation as elevated as it is, Caledonia’s returns have been well-ahead of both RPI and CPI which hit 11.1% and 9% respectively last month.
Over 10 years to the end of March, the total return on net assets has been 215%, or 12.2% per annum, which compares to annualised inflation of 3% over that period.
The UK stock market return over the financial year was 13%, lagging the 15.4% from the MSCI World Index. Nevertheless, Caledonia beat both handsomely.Over 10 years, while it is well-ahead of the All-Share, Caledonia fails to beat the MSCI World. The annualised return on the All-Share was just 7.2%, whereas the equivalent return on the MSCI World Index was 13.1%. However,…
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