JPMorgan Multi Asset Trust changes name and dividend policy
Pedro Gonçalves, Investment Week, 24 March 2021
The £80m investment trust, which has just celebrated its third anniversary, currently trades on a discount of 11.8%.
According to QuotedData, the managers are dropping the policy of having the dividend paid from revenue generated by the portfolio. The distribution policy will now be linked with inflation, meaning investors can expect a bigger return. Based on current levels of CPI, the target for the financial year ending on February 2022 would be 4.1p. The trust is currently offering 4p per share.
The trust is also changing its benchmark from the LIBOR 1Month Sterling +4.5%. The board will now measure the trust’s performance against a target of a total return of 6% a year, measured over a rolling five year period.
The company will be rebranded as JPMorgan Multi-Asset Growth & Income plc. The stockmarket ticker, MATE, will not change.
The managers said they consider using buybacks to address imbalances in supply and demand, when it believes it is in the interests of all shareholders and subject to normal market conditions.
The board said it “recognises that it is in the interests of shareholders to maintain a share price as close as possible to the net asset value per share but also recognises the importance of maintaining the size of the company”.
The overhaul is designed to improve performance that will help narrow the discount.
James Carthew, head of investment company research at QuotedData, said: “We are pleased to see MATE’s board thinking about ways of self-improvement. Returns since launch have been a little behind its proposed new benchmark, which is better than Aberdeen Diversified Income & Growth but worse than Seneca Global Income & Growth and BMO Managed Portfolio Income.
Read more here