Fund Profile

Disclaimer

Disclosure – Non-Independent Marketing Communication

This is a non-independent marketing communication commissioned by Majedie Investments. The report has not been prepared in accordance with legal requirements designed to promote the independence of investment research and is not subject to any prohibition on the dealing ahead of the dissemination of investment research.

Overview
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Overview

Majedie Investments (MAJE) is a very broadly diversified, self-managed investment trust offering exposure to a range of equity strategies – managed by Majedie Asset Management (MAM).

MAM, which manages assets of c.£8.5bn, was appointed to manage MAJE’s assets in 2014 and the trust retains a 17.2% stake in the asset management company itself, which currently represents 21% of NAV – a comparable situation to that of Lindsell Train, which is perhaps better known among retail investors. As we discuss in the portfolio section, MAJE recently adopted a new valuation policy for the asset management company based on current-year earnings to enhance disclosure.

In addition to its holding in MAM, the portfolio is split across six funds offering very broad diversification. Predominantly this is via equities, but it includes an element of absolute return/capital protection via the Majedie Tortoise Fund. For all of these underlying funds the investment process is based on fundamental, bottom-up research and aims to deliver consistent long-term returns. The managers are all ‘stock-pickers’ who are not afraid to be contrarian, and they are flexible, without rigid stylistic biases, resulting in a portfolio unlike others in the sector.

In recent years, the approach has the led the trust to being overweight towards the UK relative to peers in the global sector, with a slant toward value. However, recent market volatility has created opportunities for the managers to invest in high-quality companies at attractive valuations, and the performance of many of the individual funds has improved over the last nine months.

The trust is trading at a historically wide discount of c.24% and an attractive yield of 6% and significant reserves.

Analyst's View

This year has seen the managers at MAJE capitalise upon the instability in markets after a period of subdued returns resulting from the trust’s tilt toward UK equities and out-of-favour value stocks.

The managers say recent market dislocation has created an opportunity to find quality companies at cheaper valuations, and to add more growth-orientated companies. The trust has seen improved performance across many of the individual funds in recent months. The UK portfolio has now outperformed its benchmark over the past 12 months, and the MAM Global Equity Fund continues to achieve first-quartile performance. The recently launched MAM International Fund has also got off to a strong start.

Another noteworthy point is the trust’s holding in MAM. The board has improved the disclosure of MAM and the valuation is now based on the most recent quarter’s earnings, public market P/E multiples (discounted by 20%) and surplus cash held on the balance sheet.

An attractive feature of the trust is that the dividend yield is the highest in the sector and covered 4x by revenue reserves. These substantial reserves could appeal to income-reliant investors in the light of the current dividend drought.

Bull bear
Wide discount in absolute and relative terms Poor short-term performance record
The trust's holding in MAM - the trust's own asset management company - could benefit from upwards revision of the valuation, which is quite conservative Gearing can increase the volatility of the trust
Offers exposure to highly regarded funds which are otherwise inaccessible to private investors
Continue to Portfolio

Fund History

17 Nov 2021 In good hands
Majedie Investments offers a potentially attractive solution for investors seeking a respite from the stresses of managing their own money in turbulent times…
01 Sep 2021 A bold take on global equities
Global equity investing is usually defined by either a ‘growth’ or ‘value’ approach but there are funds that blend these styles, offering a distinctive global equity investment…
08 Jul 2021 London Calling
UK equities represent a ‘once in a generation’ opportunity for investors according to the managers who joined us to discuss the outlook at our event last week…
16 Jun 2021 A better class of travel*
Sharing many features of a traditional family office, investment trusts offer ordinary investors a cost-effective solution to managing family wealth...
27 Apr 2021 The benefits of flexibility in a topsy turvy year
As markets fell into disarray over the course of 2020, the case for investing in a variety of styles was demonstrated. Trusts like Majedie Investments offer a broad perspective in a single package…
22 Apr 2021 Fund Analysis
MAJE’s performance has been strong in the reflationary rally, but its discount remains wide…..
10 Mar 2021 Spring Conference '21
Audio and presentations from 21 of the UK’s leading investment trust managers…
04 Mar 2021 Slides and Audio: Majedie Investments
Download the presentation and listen to the audio from our 'Ideas for your ISA' Spring Conference on 02 March...
28 Jan 2021 Slow and steady wins the race
We take a look at MAJE, a trust which has seen a significant turnaround in performance and has the potential to continue delivering income and growth in 2021…
10 Dec 2020 Results analysis: Majedie Investments plc
We examine the potential for MAJE if sentiment toward the UK improves in 2021…
25 Nov 2020 Britannia Redux?
UK equities have been despised for almost five years and could offer extreme rebound potential…
03 Sep 2020 Fund Analysis
Improving performance in 2020 and a historically wide discount that values the holding in MAM at zero leave MAJE in an interesting position.....
03 Sep 2020 Eating their cooking
Our analysis suggests that asset management businesses owned by the trusts they manage are on less demanding valuations than their listed equivalents...
16 Jul 2020 A turning point for investors
2020 could mark a turning point in the fortunes of traditional value versus growth investing...
27 May 2020 Results analysis: Majedie Investments
Majedie Investments (MAJE) released its interim results for the half year to 31 March 2020 this morning, including a major overhaul of its valuation methodology for funds business Majedie Asset Management…
09 Oct 2019 Backing Britain: Tapping two UK funds for the price of one
Majedie Investments gives investors access to two funds offering distinct exposure to the UK - both with clear positions with respect to Brexit...
12 Aug 2019 Fund Analysis
Majedie Investments (MAM) offers a solid income combined with a diversified allocation to a range of funds....
29 May 2019 A vintage blend
How Majedie Investments takes the heavy lifting out of diversification...
06 Feb 2019 Income for the long haul
With 'ISA season' looming we identify investment trusts which offer long-term, dependable income streams for yield-hungry investors...
06 Dec 2018 Results analysis: Majedie Investments
A brief review of Majedie investments 30 September final results, announced 5 December 2018...
22 Aug 2018 Reassuringly expensive?
Some investment trust premiums have been stretched to eye-watering levels. Have investors been enjoying themselves in the sun too much? We try to rationalise current levels and suggest alternatives...
23 Jul 2018 Fund Analysis
Majedie Investments aims to maximise total return whilst increasing dividends by more than the rate of inflation over the long term...
23 Mar 2018 Fund Analysis
Majedie Investments is a long-established and very broadly diversified investment trust which aims to maximise total return whilst increasing dividends...
07 Dec 2017 Fund Analysis
RESULTS: Dividends up by around 11% last year, and currently yields 3.5% - more than any other trust in its sector - but the discount remains wide...
01 Jun 2017 Fund Analysis
A very broadly diversified global equities trust which aims to maximise total return whilst increasing dividends ahead of inflation over the long term...
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