Comments from Terry Smith in recent weeks led some people to believe that Fundsmith was about to launch a small-cap investment fund. This morning it was confirmed: Smithson will soon be with us.
As First World problems go, paying exit fees on your investment account must rank pretty highly. But ultimately, as more and more of us invest, it is important that the charges we incur are both fair and transparent. And broker exit fees, in many cases, seem to be neither.
Measuring the performance of your portfolio can be a little tricky in practice. Having experimented with a few methods, I’ve now settled on a mixture of Google Sheets to provide an up-to-date valuation and a simple unitisation calculation to measure my portfolio performance.
Read a little about investment funds and you’ll soon come across someone saying “investment trusts outperform other types of fund”. There are good reasons to believe that they may do, but it’s a very difficult thing to prove.
I’m not the first writer to use this terrible headline to describe Fundsmith Emerging Equities (FEET). I suspect I won’t be the last either. Some four years after it launched, with its performance yet to truly impress, it seems a valid question.
I should start by saying that I’m a big fan of Terry Smith, who is Fundsmith’s CEO, and I am an investor in the main Fundsmith Equity Fund. I suspect I may well purchase Fundsmith Emerging Equities at some point, too, but I haven’t pulled the trigger yet.
Whether an investment trust is trading at a discount or premium, and what sort of level it is, is one of the key metrics you’ll see mentioned when a fund is covered in the financial press. While it’s important, it’s usually a secondary investment consideration in my view, and you do need something to put it in historical context. Z scores are designed to provide this, so are they worth using as part of your research?
So, here’s an investment trust that’s a little bit different. Hipgnosis Songs Fund (SONG) joined the market on 11 July 2018, raising £202m at 100p per share.
It’s one of many investment trusts tapping into the demand for income and returns that aren’t directly correlated to the stock market. Hipgnosis Songs is shooting for a 5% dividend yield (based on its float price) as part of a total target return of 10% a year, courtesy of money generated from music royalties.
I am a numbers guy, so I love to crunch data to get a feel for a topic. Luckily, numbers are one thing that the investment trust industry has in spades thanks to the excellent data made available by its trade body, www.theaic.co.uk.
Here’s a whistle-stop tour of some of the key numbers that help define the world of investment trusts.
Today sees the launch of Tritax EuroBox (EBOX), which follows in the footsteps of the very popular Tritax Big Box (BBOX). Therefore, it seemed like an opportune time to review what new investment trusts have joined the stock market recently, to see what sectors are sizzling hot and what are definitely not.
There have been 29 investment trusts launched since the start of 2017 as far as I can tell. They are currently worth a collective £5bn, which represents about 3% of the total market value of all investment trusts of around £160bn. While that suggests that we are not seeing a flood of new investment trusts, there are three or four sectors that seem to be pretty popular right now.
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