M&G Credit Income

MGCI offers an exceptionally high yield from a portfolio of high credit quality...

M&G Credit Income

MGCI offers an exceptional yield from a portfolio with low NAV volatility…

M&G Credit Income

MGCI is generating a highly attractive yield from a relatively low-risk portfolio…

M&G Credit Income

MGCI’s floating rate exposure means its yield should rise as interest rates do…

M&G Credit Income

MGCI’s floating rate exposure means its yield should rise as interest rates do

Private markets: A closer look at the expanding private debt opportunity

We look at the attractions of the private debt market, historically the hunting ground of the institutional investor

The complexity premium

Demand for alternative assets has soared in recent years, as investors have sought yield and low NAV volatility outside the bond market in a low interest rate world. The investment trust sector has been a major beneficiary, with many closed-ended funds offering these characteristics through their ability to invest in illiquid assets. Historically, alternative assets have offered the potential for higher returns by (in technical terms) harvesting the illiquidity premium. In more natural language

Riders on the storm

The coronavirus pandemic has had a dreadful impact on equity dividends, particularly in the UK market. Between 31 March 2020 and 31 March 2021, UK companies cut their dividends by 41.6% on an underlying basis, according to the latest Link Dividend Monitor. The cuts have continued into 2021, with a 26.7% fall on an underlying basis in Q1. That said, there was a headline increase of 7.9% thanks to the second-highest special dividends reported, thanks to large payouts from Tesco and the rallying mi

M&G Credit Income - Overview

M&G Credit Income (MGCI) aims to generate a high yield with low volatility and low credit risk from fixed income investments. To achieve this MGCI invests extensively in the private debt markets, traditionally the preserve of institutional investors. M&G has been investing in private assets since 1997 and has c. £65.5bn in AUM in that space. It employs 287 fixed interest professionals including 130 analysts, providing coverage of the private and public debt markets, which allows MGCI’s manager,

Stairway to heaven Update

Many investors think ISA investing is all about sticking equities away for the long term and forgetting about them. However, we think there are good reasons for allocating to alternative income-generating assets in your ISA, even for those concerned with longterm capital growth. We think that many investors don’t fully appreciate the benefit of reducing the volatility on a portfolio. When thinking about long-term returns, the tendency is to think of the average return in the long run as what you

M&G Credit Income - Overview

M&G Credit Income Investment Trust launched in November 2018 and targets a dividend yield of LIBOR plus 4% per annum once fully invested. The trust offers investors access to illiquid and private debt markets, usually only the preserve of institutional investors, which offer attractive yields for taking extra liquidity and complexity risk. At all times, the managers have committed to ensure that at least 70% of the investments will be investment grade. Their aim is that the trust will offer the

Fidante Daily Digest

AUGM* - Augmentum Fintech - New investment | CAT - CATCo Reinsurance Opportunities - Investment manager update | MGCI - M&G Credit Income - Proposed placing

M&G Credit Income - Overview

M&G Credit Income Investment Trust will invest in private and illiquid fixed income debt assets, aiming to deliver a dividend yield of LIBOR plus 4% per annum over the long term. The trust will offer retail investors access to the illiquid and private debt markets which are usually the preserve of institutional investors, and which offer attractive yields for taking extra liquidity and complexity risk. The trust will be managed by Jeremy Richards, for 25 years manager of the fixed income allocat

Morning Note – 22 April 2024

Benefits of scale set to materialise

Frenkel Topping - Resilient with strong growth potential

FY 2023 was a challenging year for Frenkel with higher interest rates encouraging clients to place money into lower margin money market funds. Despite this, sales grew +32% (supported by recurring revenue +9% and +51% in non-recurring), EBIT margins remained strong at 22% and adj. EPS grew +17% (taking into account the higher number of shares). FY 2024 has seen a solid start to transactional business and there is a strong pipeline of new FUM opportunities both of which support further growth. Wi

Bluefield Solar Income Fund – Fundamentals shine despite discount

The manger comments that, in common with the other trusts in the renewable energy sector, the last six months have continued what has been a challenging period for the Bluefield Solar Income Fund (BSIF). It adds that the trust’s ongoing fundamental performance has failed to reverse a steady slide in its share price which began back in May 2023. Despite this, it says the company has continued to deliver solid NAV growth and market-leading shareholder distributions thanks to a range of contractual

LSL Property Services (LSL LN) - Transformation & market recovery

2023 results are, as indicated in its February pre-close update, “slightly ahead of market expectations”. Current trading continues to improve, with 1Q24 underlying operating profit up yoy, “reflecting the benefits of the Group’s transformation programme completed in 2023 as well as improving market conditions.” With net cash of £35m at end 2023, the Board approved 7.4p final DPS and £7m buy back.

Henderson Far East Income - Repositioning to raise total returns

Henderson Far East Income (HFEL) has consistently delivered on its objective to provide a rising dividend. However, like many investors, HFEL’s managers overestimated the potential for a post-pandemic rebound in China. The trust’s resultant overweight to Chinese consumer and other cyclicals led to a fall in portfolio revenues and underperformance in the financial year ended 31 August 2023 (FY23). With a view to improving future returns, HFEL’s board has since indicated an increased willingness t

S&U - PBT ahead, encouraging volume trends

S&U reported FY24 PBT of £33.6m, down from £41.4m in FY23 on higher funding and regulatory costs and higher impairments in Advantage in H2. PBT was 2% ahead of our forecast as stronger revenues – up 12% to £115.4m – and better costs offset higher-than-expected impairments. Net receivables grew to a record at both Advantage and Aspen and management noted particular strength in Q4 and a good trading environment in the current year. Having absorbed a significant rise in funding cost as well as addi

Hardman & Co Insight: 2023 was an annus horribilis for Quoted UK Infrastructure and Renewable Energy

The focus of Hardman & Co Research is on the nine quoted Infrastructure Investment Companies (IICs) and on the 22 Renewable Energy Infrastructure Funds (REIFs): the stocks analysed are all members of the Association of Investment Companies (AIC). We are updating our publication of January 2023, assessing both the lacklustre share price performances during 2023 and the key issues, including interest rates, inflation and power prices. As a 31-strong group, its combined market capitalisation is no

Foresight Solar Fund - Termination of coverage

Edison Investment Research is terminating coverage on ABC Arbitrage (ABCA), paragon (PGN), Foresight Solar Fund (FSFL), Kendrion (KENDR), Lithium Power International (LPI), Triple Point Energy Transition (TENT), 4iG (4IG), e-therapeutics (ETX), Pharnext (ALPHA) and Shield Therapeutics (STX). Please note you should no longer rely on any previous research or estimates for this company. All forecasts should now be considered redundant. Previously published reports can still be accessed via our web

LIBERUM: PensionBee: Strong start to the new financial year

LIBERUM: NewRiver: Q4 trading update: Continued operational momentum

International Public Partnerships - Consistently and responsibly delivering

International Public Partnerships’ (INPP’s) FY23 results show that it continues to deliver consistent and predictable returns for investors, while delivering environmental and social benefits for the individuals and communities that are served by its assets. Despite this strong performance and a substantial need for private infrastructure funding, the macroeconomic environment has weighed on INPP’s share price, in common with the wider sector. Regardless, attractive returns are available from th

Witan

Business as usual for WTAN’s executive team, while the board reviews investment management arrangements…

Regional REIT - Performing as expected ahead of refinancing

In a challenging market, Regional REIT’s (RGL’s) FY23 operational and financial performance was robust, in line with expectations and previous guidance. Investor focus remains on the company’s loan to value (LTV) reduction and bond refinancing plans, explored in detail in our previous note and RGL will provide an update on this in due course.

LIBERUM: PayPoint: On track for £100m of EBITDA in FY 26