Bankers Investment Trust
Diversification asset providing one stop global equity exposure
Launched back in 1957, the Bankers Investment Trust (Bankers) is a UK 250 listed global equity investment trust with particular appeal to UK based investors. Stock specific risk (β) is elevated at present hence the need for the kind of diversity provided by Bankers.
Run by star fund manager, Alex Crooke, the Bankers Investment Trust seeks to maximise shareholder returns through a broadly diversified international portfolio. The trust aims to deliver capital growth in excess of the UK All Share Index and regular dividend growth that exceeds the Retail Price Index (RPI).
Quite an attractive 5.55% discount to NAV
BNKR discount to net asset value per share is a moving feast, with equity market gyrations leading to discount widening to 5.55% from 0.89% end March 2014.
| Bankers Trust Inv. Trust | 28/3/ 2013 | 30/9/13 | 31/3/14 | 30/9/14 | 9/10/14 |
| NAV (AIC formula) | 548.3p | 569.6p | 575.1p | 585.2p | 577.1p |
| Share Price | 524.5p | 560p | 570.0p | 558.7p | 545.0p |
| Discount to NAV | 4.38% | 1.69% | 0.89% | 4.53% | 5.55% |
Source: CSS Investments Ltd
Equity multi asset peer group discounts/ premiums
Constructing a brief selection of similar investment trust is instructive for the dispersion in net asset value discounts and premiums.
| Investment Trust | EPIC | NAV (p) | Share Px (p) | Discount()/ Premium | COMMENT |
| Bankers Inv Trust | BNKR | 577.1 | 545 | (5.55%) | Inexpensive |
| Henderson High Income | HHI | 163.9 | 170 | 3.72% | Fair value |
| JPM Euro Growth | JETG | 228.71 | 217 | (5.12%) | Inexpensive |
| Murray Intl Trust | MYI | 982.56 | 1071 | 9.00% | Expensive |
The Henderson Group charges the fund an annual 0.3% management fee to cover investment management, secretarial and administrative services. There is an incremental performance fee of 0.15% pa per 1% of fund performance above an outperformance hurdle rate of 1.5% rising up to 0.55% up to a maximum of 0.85% per 1% .
CONCLUSION
The current environment is a bit hazardous with high stock specific risks and a number of growth/ ex-growth concerns related to different industrial sectors. The geopolitical environment is tense and some factors taken for granted over the last decade, such as strong Chinese GDP growth, benign emerging markets, cheap money are changing. This makes stock picking more cautious and increases the attractions of a broader vehicle.
Bankers offers good diversity, a broad global spread and solid core UK holdings, hence is especially appealing to UK based investors wanting a liquid equity linked asset.
52 week Bankers Investment Trust (BNKR)
