Dunedin Income Growth (DIG)

Dunedin Income Growth Investment Trust (DIG) is managed by Ben Ritchie and Rebecca Maclean, whose process combines a search for high-quality UK companies with a sustainability framework, blending exclusions, positive allocation and engagement. Following an extensive board review, the trust's negative screening criteria have been eased this year (see ESG section), reducing the proportion of the FTSE All-Share excluded from investment from around 23% to approximately 13%, primarily through greater flexibility in aerospace & defence, nuclear energy and natural resources.

The managers have already used this additional flexibility to initiate two new Portfolio positions: Rolls-Royce, where the managers see small modular reactors as a genuine clean energy opportunity, alongside defence activities they view as protective rather than offensive; and Rio Tinto, for its copper business, a low-cost, well-governed enabler of the energy transition. Elsewhere, the managers took advantage of recent market volatility, topping up several mid-cap names, whilst using AI-driven weakness to add to RELX, Experian and Softcat, which they view, in contrast to the market, as longer-term AI winners.

Over the past year to 04/08/2026, DIG delivered a positive NAV and share price total return of 13.3% and 13.7% respectively, aided by strong contributions from NatWest, M&G and ASML. The wider UK market performed considerably better, however, returning 22.0%. DIG's quality bias, sustainability exclusions and above-index small- and mid-cap exposure all weighed on relative returns, a dynamic that has also affected five-year Performance.

Regarding the Dividend, the trust delivered its enhanced 6.0% commitment, based on NAV as at 31/07/2025, in full, with total distributions for FY 2026 of 19.10p per share, a 34.5% increase on last year, marking the 42nd dividend rise in the past 46 years. At today's price, this equates to a historic yield of around 6.0% and the board has stated it intends to maintain a progressive dividend policy.

At the time of writing, DIG trades at a 7.8% Discount, wider than its five-year average of 6.5%.