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How three investment-trust revamps are faring

How three investment-trust revamps are faring

by Jennifer Hill from interactive investor | 24th September 2020 10:01

Although it is early days, we have analysed how three investment-trust revamps are faring, and have asked analysts how optimistic they feel about the outlook.

Schroder UK Public Private Trust

When Neil Woodford launched Woodford Patient Capital in April 2015 to invest primarily in unquoted companies it was the most successful investment trust launch at the time, raising £800 million. “Five years on and investors have had their patience severely tested,” says Gavin Haynes, co-founder of Fairview Investing.

Woodford’s lack of experience in private equity contributed to his downfall and the board started looking for a new manager last summer. Schroders took over on 13 December 2019 and the trust was renamed Schroder UK Public Private Trust (LSE:SUPP).

The attractions for Tim Creed and his co-manager Ben Wicks were twofold – the belief that the trust “contained a number of good companies that, with the right help, could be great companies” and that “an investment trust structure is one of the best ways for retail investors to access private companies”. These account for 90% of the portfolio…

Edinburgh investment trust

On 11 December 2019, the board of Edinburgh (LSE:EDIN) announced that James de Uphaugh of Majedie Asset Management would replace Invesco’s Mark Barnett after a long period of significant underperformance due to myriad factors – lack of favour for UK equities and the value style employed, brand damage by Barnett being Woodford’s protégé and stock-specific issues. “Barnett had too many car crashes,” says David Liddell, a director of IpsoFacto Investor…

James Carthew, head of research at QuotedData, points to the trust’s fairly high weightings to mining, oil and defence businesses appearing “at odds” with rigorous ESG integration. The notable absentee is tobacco, a stalwart of the Invesco portfolio… “It is hard to see what is going to capture the imagination of new investors.”

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