Your vote counts: the investment trust AGMs in July 2023

Kepler Trust Intelligence highlights three investment trust AGMs of note.

The summer months are usually quieter at most offices, but July is still set to be a busy period in the investment trust world, with 25 closed-ended funds holding their annual general meetings (AGMs) next month.

AGMs offer private investors the opportunity to make their voices heard and gain a better understanding of what the managers they’re invested in are doing. Here, we look at three investment trusts holding their AGMs next month, which should give you some idea as to what things are discussed and voted on at these meetings.

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Fidelity China Special Situations

This is the largest country specialist fund focused on Chinese companies. Fidelity China Special Situations (LSE:FCSS is also unusual in being able to invest up to 15% of its net asset value (NAV) in unlisted companies.

Shareholders in FCSS will vote next month on approving FCSS’ final year dividend of 6.25p per share. The trust’s shareholders will also have to vote on approval for the board to buy back shares for discount management, as well as the issuance of new shares or sale of shares held in treasury, to investors. New shares or shares held in treasury will only be sold at their NAV price.

Downing Strategic Microcap

A specialist at the smallest end of the UK stock market. Downing Strategic Micro-Cap Inv. Ord (LSE:DSM)’s board announced in January that they will provide an opportunity for shareholders to redeem up to 50% of their shares at NAV in May 2024, something that is very likely to be discussed at the AGM.

This investment trust has long traded at a wide discount, so the potential to redeem shares may both limit share price declines but also provide opportunities to realise a gain on any shares bought at that discount.

The trust’s board has put forward a motion to maintain the discount via share buybacks at next month’s AGM as well, something that should provide further downside protection to shareholders if it is approved.

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JPMorgan European Discovery

This is a small-cap fund that invests in European companies, excluding the UK. European funds saw large outflows last year. However, it is plausible we could see a shift back given valuations look more attractive and the continent has done a better job than many expected at handling a prospective energy crisis.

JPMorgan European Discovery(LSE:JEDT) shareholders will be voting on a couple of key points. One is to approve a 7.2p per share dividend. The other is to approve the board to engage in buybacks so that they can continue to manage the discount, which currently stands at close to 16%.