MIGO Opportunities

MIGO’s underlying discount to NAV has rarely been wider…

A game of two halves

In the first article of our series examining the AIC Flexible Investment sector, we divided this widely disparate group of trusts into what we think are more comparable sub-groups, identifying four roughly similar types of strategy.

MIGO Opportunities

MIGO’s underlying discounts are currently wide relative to history

The inevitabilities: death and taxes

Biotech has had a rough ride lately but, as the world gets older and richer, our analysts think long-term secular growth is inevitable

You say tomato...

Do it yourself or put it into a global fund and leave it to the experts - our analyst debate the merits of each approach

Miton Global Opportunities - Overview

Miton Global Opportunities (MIGO) offers exposure to a diversified pool of closed-ended investment companies. These often operate in highly specialised areas and are trading on substantial discounts to their intrinsic value, which MIGO’s managers believe there is a catalyst to close. Formally aiming to beat cash (three-month SONIA plus 2%), the trust is relatively unconstrained in asset allocation. With MIGO having generated the strongest NAV total returns in the AIC Flexible Investment sector

Every which way but loose

The AIC Flexible Investment sector is, like a discounted haggis, a simple casing which can house myriad ingredients. In fact, the constituent meats are so exotic that we typically caution it is not a good comparator when discussing relative performance. The individual trusts that make up the sector often aim to accomplish very different things. Meanwhile the flexible mandates of some of them mean the composition of individual portfolios can vary drastically over time. Below, we have looked at th

Fortune favours the brave (sometimes)

Everybody I know calls me a contrarian. I disagree. Nonetheless, the enduring popularity of our discount portfolio with readers can’t help but pique our interest in contrarian opportunities. With our discount opportunities portfolio, we look for opportunities in investment trusts where we can see a reasonable rationale for a wide discount narrowing and the potential for NAV outperformance too. Several investment managers, such as the managers of Miton Global Opportunities (MIGO) and AVI Global

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

Eye of the Pfizer

It is often considered axiomatic in investment markets that smaller companies offer greater pricing inefficiencies, and thus greater opportunities to active managers to generate outperformance. In the UK Small Cap space, we have certainly seen suggestions over the long term that this is true, with the Morningstar UK Small Cap sector producing an average NAV return of c. 173.4% over the ten years to 05/02/2021, compared to a return of c. 115.2% from the Numis Small Cap including AIM excluding Inv

Miton Global Opportunities - Overview

Miton Global Opportunities (MIGO) is a trust of trusts specialising in deep value opportunities and special situations. MIGO offers exposure to a diversified pool of trusts, often trading on substantial discounts to their intrinsic value and where MIGO’s managers believe there is a catalyst for a re-rating. The trust is relatively unconstrained in asset allocation. MIGO’s managers believe we are seeing structural changes to the investment trust universe which are opening up opportunities. This i

Now that's what I call a discount!

The accelerant effect of a closing discount adds considerable appeal to investment trusts for many investors, boosting the impact of a rising net asset value (NAV) when it happens concurrently, and leaving the shareholder with what is a de facto ‘geared’ return. Identifying trusts which are trading in a discount to NAV which is likely to close is no mean feat, though, with more than 450 investment trusts to choose from – and typical discounts among conventional trusts around the 10% mark. Last w

Spotlight on discounts

The ability to buy shares at a discount to NAV is one of the differentiating features of investment trusts versus open-ended funds, and is one factor behind them offering potentially higher returns. Of course, it brings with it extra risks, and the pandemic saw discounts widen across the board, compounding losses made on NAV. This is potentially an interesting tine to be looking for discounted opportunities after such a period of disruption. However, as we discuss below, on a universe-level disc

Underground bangers

In recent years smaller investment trusts have been under pressure. The demand for smaller vehicles has been reduced by two factors: the consolidation in the wealth management industry and the increasing prevalence of centralized buy lists used by DFMs and advisers. If a large amount of money is being managed to a model, then allocations can be impossible to deal into a small trust. Anecdotally, the lower limit of viable size for professionals has been rising. £200m is a more realistic cut off p

Miton Global Opportunities - Overview

Miton Global Opportunities (MIGO) offers exposure to a diversified pool of closed-ended investment companies, often operating in highly specialised areas and trading on substantial discounts to their intrinsic value where the managers believe there is a catalyst for a re-rating. Aiming to deliver cash (SONIA 3 month) plus 2%, the trust is relatively unconstrained in asset allocation. The managers are focussed on identifying ‘special situations’ and/or deep value opportunities in investment trus

Stable 4Q22

LIBERUM: Trident Royalties* - Record quarterly receipts

LIBERUM: Trident Royalties* - General Motors invests in Thacker Pass

LIBERUM: Trident Royalties* - Thacker Pass a go-go

QuotedData’s Real Estate Monthly Roundup – January 2023

Performance - 2022 ended with another difficult month for property companies as the sector continues to get to grips with the impact of higher interest rates. There were several funds that performed well during December, however, with secondary shopping centre landlord Capital & Regional top of the pile. For a second month on the trot Home REIT saw its share price tank after it came under attack from a short seller in November. Valuation moves - It was a mixed bag for valuations, with six-month

Strong H1 update and contract wins

Made Tech has announced a very strong update: H1 sales +76% y/y and alongside this, also several wins/expansions worth £27m. As a result, Made Tech has now delivered 48%/FY23e sales and as well, has a very strong backlog: £48m (+53% y/y) so is very well positioned to drive continued growth, both this year and next. Margins meanwhile leave room for improvement, as having generated £0.5m EBITDA in H1, this leaves work to do, but with contractors now materially lower (at c.10% vs. c.20% in the PY)

FY22 TU – Strong Upgrades on Better Performance

Argentex has issued a trading update for the 9M22 period this morning, with revenue and earnings performance ahead of expectations. FY22 revenues are up 54% yoy to £50.4m (+7.5% vs. SCM estimates) and operating margins are ahead of management expectations. This was driven by growth in the number of corporate clients as well as good progress across its growth strategy, with robust trading across all products and geographies. Another strong update from Argentex, as the Group continues to deliver o

Thacker Pass Update

The lithium industry, perhaps the hottest sub-sector of mining right now, was set even more abuzz by the announcement yesterday that Lithium Americas Corp has secured a $650m financing package from General Motors for the development and construction of the Thacker Pass mine in Nevada. There has been some talk for a while on when an automaker was going to make a serious investment in a battery metal mine. This is the largest ever and it is suitable that it is in Thacker Pass which is the largest

Morning Note – 31 January 2023

Hybridan Small Cap Feast - 17 Jan 23

17 January 2023 @HybridanLLP Status of this Note and Disclaimer This document has been issued to you by Hybridan LLP for information purposes only and should not be construed in any circumstances as an offer to sell or solicitation of any offer to buy any security or other financial instrument, nor shall it, or the fact of its distribution, form the basis of, or be relied upon in connection with, any contract relating to such action. This document has no regard for the specific investment object

FLASH: FY22 pre-close indicates profit beat

Q4 Activities Update

Trident Royalties Plc (AIM: TRR) has, this morning, provided an update on its activities undertaken during the quarter ended 31 December 2022. In terms of royalty receipts it has been the best quarter since inception. QoQ revenues increased 46% to US$3.5m (9x YoY). Each royalty either met or exceeded our forecasts with Koolyanobbing 52% ahead. The gold offtake portfolio was slightly above our forecast.

Hybridan Small Cap Feast - 23 Jan 23

23 January 2023 @HybridanLLP Status of this Note and Disclaimer This document has been issued to you by Hybridan LLP for information purposes only and should not be construed in any circumstances as an offer to sell or solicitation of any offer to buy any security or other financial instrument, nor shall it, or the fact of its distribution, form the basis of, or be relied upon in connection with, any contract relating to such action. This document has no regard for the specific investment object

Further investment in Zopa given impressive growth

Augmentum Fintech has announced that it has invested another £4m in digital bank, Zopa, as part of a £75m funding round alongside existing investors. The additional capital will be used to fund Zopas further growth by supporting capital requirements of its expanding balance sheet as well as provide flexibility for potential M&A activity. The bank continues to grow strongly (with >100% yoy revenue growth). Zopa marks one of AUGMs top investments and the additional provided growth capital is a pos

This Week's AIM Highlights 3rd February 2023