By Annabel Brodie-Smith
The arrival of flaming June has inevitably bought rain. Luckily the rain cleared for the AIC’s parliamentary reception on the terrace of the House of Commons on Tuesday. We launched a new report at the event, ‘Investment companies: bridging the gap between investors and markets'.
The wonderful Baroness Bowles of Berkhamsted kindly hosted the event dressed in a striking hot pink suit. She said investment trusts: “offer investors diversified portfolios that can be traded quickly on the stock exchange, without the underlying assets having to be cashed in. That means they can provide stable, long-term investment, perfect for infrastructure, just what the economy needs and ideal for pensions and ISAs.”
The wonderful Baroness Bowles of Berkhamsted said investment trusts: “offer investors diversified portfolios that can be traded quickly on the stock exchange, without the underlying assets having to be cashed in. That means they can provide stable, long-term investment, perfect for infrastructure, just what the economy needs and ideal for pensions and ISAs.”
It’s been a busy week. On Monday I spoke to European trust managers who were bullish and bouncing with enthusiasm about the prospects for European shares. Jules Bloch, co-manager of JPMorgan European Discovery told us European smaller caps are the best performing asset class of this century and had made their investors more than ten times their money. Who would have guessed that? And less surprisingly, there is a “very stretched” valuation gap between Europe and the US.
Marcel Stotzel, co-manager of Fidelity European Trust thought Trump’s tariff shenanigans had impacted investor sentiment but had overall been positive for Europe. His refreshingly honest view was “a kick in the backside can still move you forward.” Namely, European countries had received a wake-up call and are now likely to show greater unity and policy co-ordination, as well as a more pro-growth agenda.
George Cooke, manager of Montanaro European Smaller Companies said he saw record investor flows out of the US into Europe following Trump’s various announcements. Despite these record flows, the pronounced valuation difference between Europe and the US means there is still plenty of room for Europe to catch up on the US.
Marcel Stotzel, co-manager of Fidelity European Trust thought Trump’s tariff shenanigans had impacted investor sentiment but had overall been positive for Europe. His refreshingly honest view was “a kick in the backside can still move you forward.”
Please do watch the discussion and read the release which includes comments from other European managers.
Our investment expert, Ian Cowie focuses on the importance of diversification for investors, “with Trump’s tantrums taxing the patience of many investors and industries.” He explains: “Diversification is the simplest and surest way to diminish the uncertainty and potential for losses inherent in stock markets.” Ian goes on to describe why investment trusts are the ideal way to do this, mentioning his trusts which include JPMorgan Indian, Greencoat UK Wind, Ecofin Global Utilities and Infrastructure, Baillie Gifford Shin Nippon, Edinburgh Worldwide, European Assets Trust, India Capital Growth Fund and JPMorgan US Smaller Companies.
We thought it would be interesting to take a look at the portfolios of all 22 companies in the UK Smaller Companies sector to find out which are the most widely held companies. Our research revealed that XP Power, 4imprint Group and Alpha Group International top the list, with eight trusts holding each one. Do read our release to find out why our managers like these companies.
Soon we will be launching the AIC’s private investor event, the Investment Company Showcase. This will be taking place near Liverpool Street station on 10 October. So make sure you save the date!
Coming up, I will be hosting a panel session at the Investor Summit on 13 August in the City of London. Find out more and register here. And soon we will be launching the AIC’s private investor event, the Investment Company Showcase. This will be taking place near Liverpool Street station on 10 October. So make sure you save the date!
Finally, if you haven’t already done so, please sign our petition to change company law so all shareholders can vote. It’s vital that shareholders have a say on the future of their investment trust.
At home we are in the middle of A Levels (they seem to go on for ever!) and the end of term exams are fast approaching. The really good news is my eye is better and I can now see properly.
The roses are out and let’s hope we can soon enjoy some sultry midsummer nights in the garden.
Wishing you a good month.
Annabel Brodie-SmithCommunications Director, AIC