The Bankers Investment Trust (BNKR) is a global investment trust that aims to deliver capital growth in excess of the return on the FTSE All-Share index, as well as growing its dividend by more than the rate of UK inflation. Lead manager Alex Crooke looks after UK stock selection (c 38% of the portfolio) and sets the geographical asset allocation; regional portfolios are run by specialists from Henderson Global Investors’ well resourced fund management team. While there is no overall ‘house style’, all the managers are focused on not overpaying for growth. 12-month returns to 30 June have been particularly strong versus the benchmark and the trust is on track to grow its dividend for a 49th successive year.
BNKR seeks to achieve total returns above those of the broad UK FTSE All-Share index, by investing in a global portfolio of stocks. Lead manager Alex Crooke sets the gearing level and geographical weightings, as well as managing the UK portfolio, which is large versus global benchmarks at c 38%. Regional stock selection is delegated to specialist managers within Henderson Global Investors. While the managers have different investment styles, there is an overall focus on attractively valued stocks with good capital and income growth potential. During 2014 a China A share portfolio was introduced.
Stock markets in the US, UK, Europe and Asia have retrenched somewhat since the early part of the year after three years of gains, although P/E valuations remain close to 10-year highs in most cases, suggesting a selective approach to stock picking is advisable to avoid areas of overvaluation. Short-term volatility is likely, given the still uncertain fallout from the Greek debt negotiations, a sharp sell-off in China and the fact that the summer is often an unsettled period for markets, owing to thin trading volumes.
BNKR’s discount to cum-income net asset value narrowed sharply in the second quarter of 2015 and the shares stood at a 0.2% premium at 10 July, compared with a one, three and five-year average discount of 3.3%, 3.0% and 6.6% respectively. The shares also briefly moved to a premium in mid-June but have not traded consistently above NAV since early 2014. In March 2015, when the discount was the widest over the last 12-months at c 6%, BNKR bought back 25,000 shares, the first time it has done so since 2012.