Discount Delver: the 10 cheapest trusts on 22 November 2024
We reveal the biggest investment trust discount changes over the past week.
22nd November 2024 12:19
by Kyle Caldwell from interactive investor
Investment trusts, due to their closed-ended structure, offer investors the chance of picking up a potential bargain. Such an opportunity arises when a trust’s share price is lower than the underlying investments held by the trust (the net asset value, or NAV).  Â
However, a trust trading on a discount to NAV is not necessarily a buying opportunity. There’s likely a good reason why the trust is cheap, such as subdued short- or long-term performance, or poor investor sentiment towards how it invests.  Â
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In our weekly series, interactive investor highlights the 10 biggest investment trust discount moves over the past week.
In total, nearly 400 investment trusts have been screened, with the data sourced from Morningstar. Venture Capital Trusts (VCTs) have been excluded. We also strip out trusts with less than £20 million in assets and those that are not available on the interactive investor platform.Â
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This week’s trend is that a trio of UK-focused investment trusts have seen their discounts widen. Even though the UK market is cheap on valuation grounds, and despite performance picking up over the past year - particularly among some mid- and small-caps - retail investors are continuing to shy away from their home market.
However, on the whole, even with many investors allocating elsewhere, discounts for UK-focused investment trusts are not excessive, with the average UK All Companies trust trading on a discount of -10.5% and the average UK Equity Income trust on a discount of -4.9%.
The three UK investment trusts in this week’s table are CT UK High Income (LSE:CHI), Aberforth Geared Value & Income (LSE:AGVI) and Oryx International Growth (LSE:OIG), which are now trading on respective discounts of -10.3%, -15.1% and -31.7%.
There’s a mix of sectors in the rest of the table, with three trusts, Syncona (LSE:SYNC), New Star Investment Trust (LSE:NSI), and Life Science REIT (LSE:LABS), trading on discounts of more than -40%.
| Investment trust | Sector | Current discount (%) | Discount/premium change over past week* (%) |
| CT UK High Income (LSE:CHI) | UK Equity Income | -10.3 | -8.2 |
| Aberforth Geared Value & Income (LSE:AGVI) | UK Smaller Companies | -15.1 | -7.3 |
| Syncona (LSE:SYNC) | Biotechnology & Healthcare | -44.3 | -6.7 |
| Brown Advisory US Smaller Companies (LSE:BASC) | North American Smaller Companies | -9.4 | -6.5 |
| Oryx International Growth (LSE:OIG) | UK Smaller Companies | -31.6 | -5.8 |
| GCP Asset Backed Income (LSE:GABI) | Debt - Direct Lending | -15.3 | -5.6 |
| New Star Investment Trust (LSE:NSI) | Flexible Investment | -40.3 | -4.8 |
| Life Science REITÂ (LSE:LABS) | Property - UK Commercial | -49.8 | -4.8 |
| Mobius Investment Trust (LSE:MMIT) | Global Emerging Markets | -8.6 | -4.6 |
| Weiss Korea Opportunity  (LSE:WKOF) | Country Specialist | -3.2 | -4.2 |
Source: Morningstar. *Data from close of trading 14 November 2024 to close of trading 21 November 2024.Â
These articles are provided for information purposes only. Â Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties. Â The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.
Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.