By Annabel Brodie-Smith
Well the daffodils are out, particularly important for me as I’m from Wales and have been celebrating St David’s Day with Welsh cakes. Please don’t talk to me about the rugby… But it doesn’t really feel like spring – it’s freezing. Let’s hope the weather proverb for March, “in like a lion, out like a lamb” is correct.
It’s been an eventful week as Rishi Sunak and Ursula von der Leyen announced the new deal, the “Windsor framework”, which will govern Northern Ireland’s place within the UK and EU’s single market.
Clearly, I didn’t know Ian Cowie’s piece on European investment companies would be quite so topical when I commissioned it. But as Ian concludes, “it makes sense for investors to consider a positive approach to European opportunities, just as Sunak and von der Leyen have done with their new Brexit deal at Windsor.”
It’s easy to overlook companies in Europe but Ian reminds us of some of the world’s leaders. My personal favourites he mentions include Nestle (KitKats), LVMH (champagne, cognac and handbags), Hermes International (scarves and handbags) and EssilorLuxottica (Ray-Ban sunglasses). It’s striking that the best performing investment company in this sector, Fidelity European Values, has returned 17% over one year, 78% over five years and 204% over a decade.
This month Faith Glasgow has delved into venture capital trusts (VCTs) and what investors need to know about them. Interestingly, VCTs are also affected by the Windsor Framework which now makes it clear that UK has full control of its subsidy regime. This means HM Treasury can now unilaterally remove the ‘sunset clause’, previously imposed by the EU which would have ended tax relief on VCTs. This is good news not just for VCTs and their investors but for the many small businesses that benefit from VCT funding.
With the end of the tax year approaching, we have also looked at investment company ISAs. I’m sure many of you have already been investing your ISA allowance. But if you need some help we have asked four advisers and wealth managers for their recommendations for young, middle-aged and retired investors.
For younger investors they range from UK smaller companies (Odyssean Investment Trust) to private equity (Oakley Capital). For the middle-aged, the advisers’ picks include the global investment companies Alliance and AVI Global Trust. And for the retired, suggested choices include the infrastructure investment company, International Public Partnerships, the UK-focused Edinburgh Investment Trust and Invesco Bond Income Plus.
Finally, we are continuing with our regular ‘Focus on …’ feature which aims to help you get the most out of our website theaic.co.uk when researching or monitoring investment companies. This month’s piece explains how to set up alerts for the companies you are interested in. You can decide which data points you want to monitor: it might be share price, discount, yield or stock exchange announcements. You will then receive an email when the data point at your chosen company is triggered.
On 30 March at 2pm I’m participating in an Investors’ Chronicle webinar on ‘Finding value in UK equities’ which is free to attend. With me will be Sue Noffke, manager of the dividend hero investment company, Schroder Income Growth as well as Jean Roche, manager of Schroder UK Mid Cap Fund. The session is moderated by Dave Baxter, the funds editor at Investors’ Chronicle. Please do register here.
I hope you have a good month. I’m looking forward to my younger son singing in a school concert at Birmingham Symphony Hall to celebrate the King’s coronation at the end of March.
Let’s hope spring arrives soon!
Annabel Brodie-SmithCommunications Director, AIC
