by Jennifer Hill from interactive investor, 30th July 2024:
In some cases, having a high yield can come at the cost of overall total returns, but it’s not always the case: certain funds allow investors to have their cake and eat it.
Greencoat UK Wind
The trust boasts a share price total return of 129.2% over 10 years, according to Deutsche Numis, making it the clear leader in the renewable energy infrastructure sector.
“Share prices across the sector have been weak since September 2022 as bond yields increased and power prices fell. However, there’s reason to believe both of those factors are beginning to reverse,” adds Parfect.
Downing Renewables & Infrastructure
QuotedData likes Downing Renewables & Infrastructure for its well-covered dividend yield and portfolio diversity.
“It set out to diversify by geography and technology, which it has achieved with a mix of hydro, solar, wind and grid services in the UK, Sweden and Iceland,” says its head of investment companies James Carthew. “This trust is the only way for UK retail investors to get access to some of these areas.”
Having launched in December 2020, it ranks top quartile over one and three years. Future returns are expected to come from the upgrade of its hydropower assets and grid-balancing activity in the Nordics and UK.
Shares can be bought at around a -30% discount to NAV, which is “entirely unjustified but offers investors decent upside if it closes”, adds Carthew.
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