Fund Profile

Disclaimer

Disclosure – Non-Independent Marketing Communication

This is a non-independent marketing communication commissioned by MIGO Opportunities. 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

MIGO Opportunities Trust (MIGO) is a distinctive trust that aims, like many retail investors who find themselves drawn to the investment trust universe, to benefit from inefficiencies in the UK-listed funds’ market. MIGO aims to invest widely, spreading risk across many different managers, asset classes and special situations, with the aim of adding diversification to existing investor portfolios and generating a differentiated source of returns.

As discussed in the Portfolio section, whilst a discount is not the primary reason for investing, a potential medium-term, i.e. 18 months or longer, catalyst for the discount to narrow is. Managers Nick Greenwood and Charlotte Cuthbertson aim to provide exposure across opportunities which they believe are capable individually not only of generating strong total returns, but also of having a potential accelerant from the share price discount narrowing. Running a closed-end fund allows the team to have more patience than ‘the market’ and invest in opportunities that are less liquid.

As noted in the Gearing section, the team tend to run with cash on the balance sheet, but the current high level of cash, standing at 15% as at 31/07/2022, is representative of Nick’s desire to be able to invest in distressed opportunities as they present themselves.

Nick monitors the average discount of the top 12 holdings over time, which tends to sit between 15% and 25%. Currently, the discount is 28% having widened dramatically so far this year, which Nick believes suggests that, from a historical perspective, this could be an attractive time to consider the trust. As regards MIGO’s own discount, the price has tracked the NAV relatively closely.

Analyst's View

Manager Nick Greenwood has over 40 years’ experience as an investment trust buyer. With co-manager Charlotte Cuthbertson, their expertise in what is often a relatively overlooked area of the stock market is a key attraction, in our view.

Overall, the portfolio reflects a classic contrarian approach applied to the listed-fund universe. Nick has shown that taking positions in unfavoured assets can offer, potentially, asymmetric upside through improvements in sentiment. Given his long years of experience and the advantages offered by MIGO’s closed-ended structure, Nick can fearlessly tread in areas of the market that might put off more fearful investors. As such and in our view, MIGO likely adds diversification to existing portfolios and an uncorrelated source of returns.

2021 saw MIGO deliver a very strong Performance, driven by diverse exposures such as private equity, mining, Vietnam and UK Microcap investment trusts. This year, discounts widening across the board have led to MIGO’s NAV underperforming world equities. We believe that MIGO offers an elegant one-stop-shop, offering exposure to special situations in the UK-listed funds’ market, backed by an investment process which has outperformed wider equity markets periodically. Given that periods of MIGO’s strongest outperformance of markets have, typically, followed times when discounts across the portfolio have been widest, this may be an interesting time to consider investing.

Bull

  • Diverse exposure to an array of otherwise hard-to-access, relatively illiquid opportunities
  • Expert management in a specialist field
  • Look through discount of portfolio at widest end of historic range

Bear

  • Illiquid nature of many closed-ended holdings makes discounts vulnerable to market reversals
  • Trust-of-trusts structure involves a double layer of fees
  • Opaque nature of some alternative asset trusts may mean that discounts persist
Continue to Portfolio

Fund History

23 Oct 2024 Market matters with Charlotte Cuthbertson, manager of MIGO
We discuss big picture market insights with leading investment experts...
10 Jul 2024 Fund Analysis
MIGO’s managers say there are too many great opportunities to fit them all in the portfolio…
10 Jul 2024 Things can only get better
Discounts are yawning but markets are thawing and boards are on the offensive; Labour might not be the only thing making a comeback this year...
10 Jan 2024 Definitely maybe
Fund flows and discounts may shed some light on a once-in-a-generation opportunity…
29 Nov 2023 Fund Analysis
Manager Nick Greenwood argues current investment trust discounts present a once-in-a-generation opportunity…
25 Oct 2023 We’re going to need a bigger boat...
We argue corporate activity is picking up, making the investment trust sector an exciting place to invest…
27 Sep 2022 Fund Analysis
MIGO’s underlying discount to NAV has rarely been wider…
06 Jul 2022 A game of two halves
In the second article of our series on the AIC Flexible Investment sector we see how performance has stacked up during two years when markets were poles apart...
20 Apr 2022 Fund Analysis
MIGO’s underlying discounts are currently wide relative to history…
14 Apr 2022 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…
30 Mar 2022 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...
11 Aug 2021 Fund Analysis
MIGO’s managers report that market conditions continue to offer them attractive discount opportunities...
21 Jul 2021 Every which way but loose
We break down the AIC Flexible sector into more useful segments…
02 Jun 2021 Fortune favours the brave (sometimes)
Our research suggests wide discounts often herald high NAV returns too…
19 May 2021 The complexity premium
We examine the idea that extra returns can be obtained from buying investments which are perceived to be more complex by most investors...
10 Feb 2021 Eye of the Pfizer
Mining shares have rallied in recent months. With further potential, what impact could this have on the relative returns of active UK Small cap strategies...
17 Dec 2020 Fund Analysis
Investing in a diverse array of other trusts, MIGO seeks to build a portfolio with significant embedded value...
11 Nov 2020 Now that's what I call a discount!
Presentations and audio from our conference focussed on discount opportunities in the investment trust sector…
11 Nov 2020 Slides and Audio: Miton Global Opportunities
View the presentation and listen to the audio from our 'Discounts in Focus' event on 05 November...
22 Oct 2020 Spotlight on discounts
As our event focussed on discounts approaches, we update our portfolio of discount opportunities and review discounts across the wider IT universe…
09 Jul 2020 Fund Analysis
Using a diverse array of investment trust strategies, MIGO seeks to build a portfolio of trusts with significant embedded value...
06 Nov 2019 Times are a changin'? The case for a value resurgence
We are in the midst of the longest period of value underperformance since the 1920s. Could we be approaching a change in environment?
23 Oct 2019 Kepler Rated: Miton Global Opportunities
This trust pursues a highly specialised 'fund of funds' approach, aiming to identify discounts which the manager thinks do not reflect reality...
25 Sep 2019 One-stop shop: how multi-asset trusts offer superior diversification
Investment trusts are particular suited to this mode of investing. We examine their advantages over open-ended funds and highlight the trusts which do it well…
25 Sep 2019 Fund Analysis
Using a diverse array of eclectic investment trust strategies, MIGO seeks to build a portfolio of trusts with significant embedded value...
13 Feb 2019 Fund Analysis
A highly differentiated fund of investment trusts, which has delivered annualised returns of 7.5% since launch in 2004...
30 May 2018 Fund Analysis
A highly differentiated special opportunities fund of funds, managed by one of the most experienced managers in his sector...
20 Mar 2018 Star struck
Star culture presents siginficant problems for asset management companies when top managers jump ship. We examine the steps some groups take to avoid them...
30 Aug 2017 Smoke and mirrors?
We analyse whether investors should really focus on discounts and premiums when making their investment decisions...
09 Mar 2017 Fund Analysis
A global trust of investment trusts that is diversified in terms of regions and asset classes..
View all

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