James Carthew: The flexible trust to shelter from market volatility
Majedie has proven itself to be steady vehicle since it changed manager three years ago.
Volatile markets, game-changing technology, and unpredictable politicians are frustrating many investors. At times like these, there can be comfort in having at least part of your portfolio in funds that are managed conservatively and with a long-term mindset.
The bulk of these can be found within the AIC’s flexible investment sector, which is designed for funds that invest in more than one asset class. The sector is an odd mix of trusts with a variety of remits; eight of these focus more on long-term capital preservation than beating index benchmarks.
I recently caught up with Majedie Investments (MAJE), which changed its manager in January 2023, so now has a relevant three-year track record. It aims to achieve total returns of at least UK CPI plus 4% per annum, averaged over five years.
It describes its approach as a ‘liquid endowment model’, which means thinking about the prospects for investments over the very long term and avoiding really illiquid strategies. The factsheet says over three quarters of the portfolio could be liquidated within 90 days and 94% within a year.
I wrote about the manager change back in November 2022. At the time, the trust had a market cap of £95m and was trading on a 24% discount. Fast forward to today and the market cap is now £146m and the discount 13%.
More importantly, perhaps…. read more here