Witan Investment Trust’s (WTAN) investment director James Hart suggests that equities are currently an attractive asset class for the patient and selective investor. He believes that selectivity is becoming more important given the elevated valuation levels of parts of the equity market. The director argues that this plays to the strengths of WTAN’s multi-manager investment approach, with experienced managers that are able to take advantage of the evolving investment environment. Although relative performance was weaker than average in 2018, the trust has outperformed its composite benchmark over the last three, five and 10 years, while generating NAV and share price total returns between 11.0% and 15.0% pa over the last three, five and 10 years.
While global equity markets are experiencing higher levels of volatility as investor sentiment shifts in response to macro developments (including the ongoing trade dispute between the US and China), taking a longer-term view could highlight attractive opportunities. Over the long term, equities have delivered higher annual total returns than other asset classes such as government bonds or cash.
Broad equity exposure to world markets via specialist multi-manager strategy; the trust may be considered as a ‘one-stop-shop’ for global investment. Long-term outperformance of its benchmark. The majority of the external managers’ strategies are unavailable to the retail investor, and WTAN’s direct investments offer exposure to niche opportunities. Progressive dividend policy; 44 consecutive years of growth in the dividend.
The board actively manages WTAN’s discount, aiming for its shares to trade close to NAV. The shares are currently trading at a 2.5% discount to cum-income NAV, which compares with the 2.0% to 3.1% range of average discounts over the past one, three and five years. WTAN aims to grow its annual dividend at a rate higher than UK inflation; it has delivered 44 consecutive years of dividend growth, compounding at c 9% pa over the last decade.