Fund Profile

MIGO Opportunities 13 February 2019

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

Miton Global Opportunities aims to deliver returns in excess of sterling three-month SONIA +2% by investing in other investment trusts that the managers believe are trading on discounts which are wider than they should be.

The trust, which sits in the AIC’s Flexible Investment sector, has little in common with its stablemates in this sector, and has few comparable peers as a trust of investment trusts because of its unique focus on cash-plus returns.

It is highly focused, with 87% of its assets held in the top ten holdings, and the investment process is very much a ‘qual’ affair - driven by manager Nick Greenwood’s expertise built on near 40 years’ experience in the sector. Since December 2017 Nick has been supported by Charlotte Cuthbertson, who is a dedicated analyst resource for the trust.

The pair use few quant screens or filters, barring a system that allows them to monitor investment trust NAVs in ‘real time’ – estimating the real NAV of a trust by looking at its underlying holdings and working out their value, rather than waiting for end-of-day NAV updates from the trust itself, or indicative NAVs that largely reflect the movements of the major index constituents in a trust’s given market.

The trust is focused wholly on capital growth and has outperformed the average trust in the AIC Flexible sector by a broad margin over five years, delivering 62.5% in NAV total return terms versus 36% for the sector. Since launch in 2004, it has delivered annualised NAV total returns of 7.5%. Performance comes in fits and starts, however, with very strong years (2015 and 2017 being examples) coming between leaner years, an example here being 2018.

This is characteristic of the nature of the strategy. The managers are picking up trusts on wide discounts because, for varied reasons, the market does not recognise the opportunity they represent. Regardless of the managers’ skill, there isn’t much they can do to make the market see what they do – so it’s something of a waiting game.

The trust was stuck on a significant discount of its own until recently, but after a major overhaul by the board – which introduced a number of new strategies to deal with it – the discount has reacted and the trust has been trading on an intermittent premium over the last twelve months.

Pascal Dowling
Pascal is a partner at Kepler Partners LLP. He runs Kepler Trust Intelligence as a product, having joined Kepler to launch it in 2015. Prior to joining the Kepler team, Pascal managed FE Trustnet, one of the UK's largest investment research websites, for ten years. Pascal started his career sixteen years ago as a financial journalist, and has written extensively about investment trusts and other investments for the trade and national press.
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Fund History

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 Fund Analysis
Using a diverse array of eclectic investment trust strategies, MIGO seeks to build a portfolio of trusts with significant embedded value...
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…
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..
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