Your vote counts: investment trust AGMs in July 2024

July ushers in more than 20 annual general meetings (AGMs) in the investment trust sphere. This includes a wide range of sectors from infrastructure to emerging markets and natural resources to private equity.

Once a genteel occasion where shareholders would share a convivial cup of tea with the board, AGMs have since become livelier occasions with shareholders using their collective muscle to instigate change.

• Invest with ii: Buy Investment Trusts | Top UK Shares | Open a Trading Account

AGMs are an excellent opportunity to hear first-hand from the managers about how they’re managing the trust and their thoughts on the wider sector. Shareholders can also vote on resolutions such as the election of directors, executive pay and share buybacks.

To give you a flavour of some of the issues being considered, we look at the upcoming AGMs for three investment trusts. In a separate piece, interactive investor has covered all you need to know about Scottish Mortgage’s AGM on 4 July.

• Scottish Mortgage AGM: a guide to what the resolutions mean

Cordiant Digital Infrastructure

Cordiant Digital Infrastructure (LSE:CORD) aims to capitalise on the growing demand for interconnected technology by investing in a portfolio of infrastructure assets linked to the digital world, including fibre and tower networks and data centres. It aims to generate a total net return of 9% per annum, including income with a current dividend of 4.2p.

Resolutions at the AGM include a vote on approving the increased final dividend for the year, designed to provide a cash return for investors whilst enabling the managers to invest in asset growth.

Shareholders will also vote on the authorisation to buy back shares, which is used by investment trusts to manage discounts.  Cordiant announced a £20 million share buyback programme in 2023 and is currently trading on a discount of around -37%.

Shires Income

Shires Income (LSE:SHRS) aims to deliver an above-average income together with the potential for capital growth. The portfolio is primarily invested in high quality UK equities due to their resilient earning streams and around 20% of the portfolio is allocated to preference shares. These do a lot of heavy-lifting on the income front which provides the managers with the flexibility to extend their remit to lower-yielding companies with a higher potential for dividend growth.

Turning to the AGM, the board is putting 17 resolutions to shareholders, including approval to change the trust’s investment policy to raise the limit on overseas stocks from 10% to 20% to provide greater flexibility.

Templeton Emerging Markets

Templeton Emerging Markets Investment Trust (LSE:TEM) is the largest and most liquid trust in the emerging markets sectors and provides access to some of the fastest-growing global economies which offer large consumer markets, a rising middle class and substantial natural resources.

Managers Chetan Sehgal and Andrew Ness hold a portfolio of quality companies with good cash flow generation, sustainable earnings power and share prices trading below their intrinsic worth. Around 80% of the trust is invested in Asia and, by sector, more than half in financials and information technology, with the top holdings including semiconductor giant Taiwan Semiconductor Manufacturing (NYSE:TSM) and Indian financial services group ICICI Bank (NYSE:IBN).

The trust has a continuation vote every five years and this will be held at next month’s AGM, which also marks the trust’s 35-year anniversary. There will also be votes on the final dividend and the continuation of TEMIT’s share buyback programme.  

Jo Groves is an investment specialist at Kepler Trust Intelligence.