July

Monthly | Investment companies 

Winners and losers in June 2025

In a continuation of May’s relative recovery from the effects of the US’ ‘liberation day’ tariffs, technology stocks led the pack of best performers. A renewed optimism for AI stocks contributed to rises for indices such as the S&P500 and the Nasdaq Composite, which closed their best quarters in over a year, with the former particularly exposed to large cap tech. Nvidia was the standout holding among tech trusts, especially for those like Manchester & London, which had 38% of its portfolio in Nvidia at the end of May. The company reached an all-time high share price of $155 on 26 June, supported by signs of easing US/China trade relations and strong earnings figures that were published towards the end of May.

Growth capital trusts may have been helped by lower US government bond yields, leading to improved confidence in higher risk and earlier stage investments. Also, news of a tender offer for Schroders Capital Global Innovation contributed to sector gains.

Falling interest rates/bond yields are also helpful for high yielding renewable energy trusts. It is also worth mentioning that six renewable energy trusts have successfully passed continuation votes in the last two months, reflecting confidence in a rebound for the sector. The bid for Downing Renewables and Infrastructure will also have had an impact. In the case of Asian Pacific equity income trusts, continued shifts out of US equities to Asian counterparts will have bolstered returns. Moreover, talks between the US and Chinese governments aimed at resolving their trade war fostered hope of de-escalation. This also coincided with the depreciation of the US dollar against several Asian currencies, most notably the Taiwan dollar, which surged to a three year high against the US dollar, appreciating 12% year to date. Japanese smaller companies will have benefitted from the same tailwinds, as foreign inflows into Japanese equities reached their highest quarterly figure in two years.

Best performing sectors in June 2025 by total price return

In terms of the worst performing sectors, losses were relatively minimal compared to previous months. Trusts in the leasing sector may have been affected by fluctuating oil prices amid volatile geopolitical events during the month. For the debt sectors, significant outflows from US long term bonds reflect weaker investor confidence. This ‘exodus’, as described by the FT, is the fastest rate of bond exits since levels seen during the COVID-19 pandemic. The weakening US dollar is weighing on trusts with relatively high exposures to the country, including many hedge funds.

The Property – Europe sector demonstrated relative resilience, with slight downturns. German residential property prices have risen for the second consecutive quarter, however sentiment for European real estate sentiment fell in the period. This was indicated by the European real estate fund association, INREV, whose consensus indicator dropped to 52.2 in June from 56.7 in March. It seems that sentiment for the sector may be adjusting to the region’s leading position in a global recovery amid tariff fallout, as investors are cautious of market trajectory.

Worst performing sectors in June 2025 by total price return

Best performing investment companies

In terms of the best performers, emerging markets funds benefitted from the already discussed depreciation of the US dollar. This favoured certain foreign markets, particularly in East Asia. Templeton Emerging Markets and Mobius Investment Trust have been beneficiaries, as has Utilico Emerging Markets, which is held by UIL. UIL’s gold exposure has also been working in its favour. This would also explain Golden Prospect Precious Metal’s feature on the share price returns side of the table, with the price of gold reaching $3,431 per ounce on 13 June. Since an all-time high price of gold was reached in April, sustained geopolitical uncertainty has led to further price appreciation for the trust.

Allianz Technology Trust and Polar Capital Technology were clear beneficiaries of the resurgence in technology shares, particularly those tied to AI, semiconductors, and platform technologies. The late May rally in large-cap US tech stocks filtered into June, helping these trusts post strong NAV growth. Also, both funds have considerable investments in TSMC, which hit an all-time high share price of $228.88 on 27 June. This was driven by TSMC’s central role in the AI trade, which is once again having a big influence on markets.

After a period of difficult performance, the uranium price has been recovering, boosting Geiger Counter. Market sentiment was encouraged by developments such as the $200m capital raise for the Sprott Physical Uranium Trust (SPUT). Geiger Counter has also reached an agreement with activist investor Saba, which bars the requisition of a meeting until at least 2028. The US’ military involvement in the attack of Iranian nuclear sites will also have been a contributing factor to uranium price volatility. Elsewhere in the commodities sector, Baker Steel’s share price was uplifted by the sale of its royalty on the Prognoz silver project. The trust’s look through share of the sale amounts to $5.16m, which should arrive in Q3.

NAV growth for Odyssean, Rockwood Strategic, Strategic Equity Capital and Chelverton UK Dividend Trust has been reinforced by optimism following May’s rate cuts. The considerably wide discounts among UK small caps may have attracted investors, as the FTSE SmallCap Index rose over 3.5% over June. Rockwood Strategic’s recent results showed outperformance of the index and the AIM All-Share. Subsequent to this strong investor demand, 3.8m shares were issued from 31 March to 13 June 2025.

Best performing trusts in total NAV (LHS) and share price (RHS) terms over June 2025

As discussed above, renewable energy trusts have had a bit of a bounce. Topping the table was SDCL Energy Efficiency Income Trust, which said that it was reviewing its strategic options. Downing Renewables and Infrastructure was the subject of an all-cash offer from Bagnall Energy, which values the fund at approximately £174.6m. Gresham House Energy Storage completed an £8.6m third party equity raise for Glassenbury Battery Storage Ltd. GRID sees the transaction as a template for future augmentations, with construction expected to begin this month. Digital 9 Infrastructure completed the sale of its stake in SeaEdge UK1 to Stellium Datacentres for £10.7m. The fund plans to use the proceeds of the sale towards paying down its RCF.

Seraphim Space’s recent newsletters and its Q3 results (published early in the month) highlighted a string of successes within the portfolio, including ICEYE securing a €200m contract with the Polish government for SAR satellites, along with new partnerships such as with Rheinmetall in Germany. Another growth capital trust with strong returns was Schroder Capital Global Innovation, which proposed a plan for a tender offer, following the approval of its managed wind down in February.

The pursuit of a managed wind down from Syncona was instrumental in that fund’s gains. Also, Syncona’s board may provide institutional investors the opportunity to transfer their stakes into a new private investment vehicle.

Worst performing investment companies

Relatively modest falls in NAVs over the course of June can often be attributed to a weaker US dollar. There was no new news from NB Distressed Debt Extended Life. Its NAV has been on a steady decline this year.

Despite appearing on the best performing table for price growth, Golden Prospect Precious Metal saw its NAV decrease over June. One factor was a fall in the share price of the trust’s largest holding West African Resources. The price dropped ahead of the nationalisation of five gold mines in Burkina Faso. Since August 2024, the country’s government has taken steps to increase control over its resources. It says that it has plans to target other mines in the country.

Worst performing trusts in total NAV (LHS) and share price (RHS) terms over June 2025

Investors in PRS REIT are likely dissatisfied with the cash offer made by Long Harbour for the company. The proposal, which values PRSR at £631.6m or 115p per share, was 19% below the 139.6p NAV at the time. Another property trust, Custodian Property Income REIT, saw price falls. It announced results and made an all-share acquisition of Merlin Properties during the month but neither piece of news likely accounts for the fall.

JPMorgan Core Real Assets said it was about ready to make a distribution to shareholders. The share price move seems at odds with that.

Moves in discounts and premiums

More expensive (LHS) and cheaper (RHS) relative to NAV over June 2025

All the trusts that became more expensive over the month (or perhaps less cheap would be a better description, seeing as most of these are still on wide discounts) have already been discussed.

In terms of the cheaper trusts, JPMorgan Emerging EMEA has continued to be held back by a lack of progress in resolving the war in Ukraine, as well as its ongoing court case. A hearing date for this has been delayed again. Despite UIL’s NAV rises, a fall in its share price led to a widening discount. As mentioned, an underwhelming proposal for PRS REIT’s assets contributed to its discount widening.

Money raised and returned

Money raised (LHS) and returned (RHS) over June 2025 in £m

abrdn Asia Focus converted its loan stock into equity. Custodian issued shares in connection with the deal we discussed above.

Polar Capital Global Financial’s top spot for money returned reflects the completion of its 100% exit opportunity. European Opportunities Trust’s latest tender offer was taken up in full. It is no surprise to see Scottish Mortgage and Smithson on the list as both continued their long buyback programmes.

Major news stories and QuotedData views over June 2025

Property news

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In an environment of heightened volatility triggered by Trump’s tariff policies, European stocks have actually fared relatively well. Germany’s plans to boost defence and infrastructure spending, coupled with falling interest rates, helped create more positive sentiment towards the region. Montanaro European Smaller Companies’s (MTE’s) high(conviction portfolio of good(quality growth stocks seems well placed to navigate this period of uncertainty. Low valuations relative to history enhance the upside potential.

MTE’s board has taken steps to enhance shareholder value through regular 5% tender offers (offers to buy back a portion of shares at a fixed price that is usually close to NAV to reduce the discount and provide liquidity to shareholders that wish to exit), a single(digit discount policy, and lower management fees. Against a backdrop where European small cap equities remain significantly undervalued relative to large(cap equities – despite offering superior earnings growth – MTE looks well positioned.

Global Opportunities Trust (GOT) has a distinctive, carefully considered, flexible, go(anywhere investment approach that has done a good job of delivering positive NAV returns over the medium(to(long term, while holding up relatively well in periods of market downturns.

The management team believes that the forces that drove markets ever(higher in the three decades leading up to 2020 are faltering or reversing. They believe that this will make it harder for markets to make progress, but could create more opportunities for its agile approach to deliver attractive real returns through the cycle. Currently, the portfolio is conservatively positioned across six themes – the demand for income, resilient businesses, improving Japanese corporate governance, resurgent defence spending, attractively valued businesses benefitting from digitalisation, and undervalued European mid-caps.

The strong recent performance of Ecofin Global Utilities and Infrastructure Trust (EGL) has continued into 2025. Despite market volatility, manager Jean(Hugues de Lamaze delivered 7.1% net asset value (NAV) total return growth for the six months to 31 May. This was well ahead of the two most relevant utilities and infrastructure indices, as well as UK equities, and only a little behind global equities as measured by the MSCI World Index. At 12.3%, share price total return performance was even better, as EGL’s discount to NAV narrowed – a very welcome development for shareholders.

This strong recent performance has been generated through a tactical focus on networks, environmental services and transportation infrastructure as a diversifier. These themes are visible throughout the portfolio, the latter notably in the recent purchase of two airport operators. We believe that EGL offers investors exposure to an attractive portfolio of assets, underwritten by powerful underlying drivers, particularly the growth in demand for energy.

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Appendix 1 – median performance by sector, ranked by 2025 year to date price total return

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