Interactive Investor

Discount Delver: the 10 cheapest trusts on 29 December 2023

We reveal the biggest investment trust discount changes over the past week.

29th December 2023 09:29

Sam Benstead from interactive investor

Investment trusts, due to their closed-ended structure, offer investors the chance of picking up a potential bargain. Such an opportunity arises when a trust’s share price is lower than the underlying investments held by the trust (the net asset value, or NAV).   

However, a trust trading on a discount to NAV is not necessarily a buying opportunity. There’s likely a good reason why the trust is cheap, such as subdued short- or long-term performance, or poor investor sentiment towards how it invests.   

In our weekly series, interactive investor highlights the 10 biggest investment trust discount moves over the past week. We publish this article every Friday, using data up to the close of trading the previous day.   

In total, nearly 400 investment trusts have been screened, with the data sourced from Morningstar. Venture Capital Trusts (VCTs) have been excluded. We also strip out trusts with less than £20 million in assets and those that are not available on the interactive investor platform. 

Nine different Association of Investment Company (AIC) sectors were present in this week’s Discount Delver list, as markets moved sideways during the quiet Christmas period and no clear investment theme emerged as a winner or loser.  

The FTSE All-Share index was marginally positive over the last five trading days, while the S&P 500 index of America’s largest companies rose 1.25% in dollar terms.  

Investment trust discount moves were relatively restrained, with just one company seeing its discount rise more than five percentage points.  

That was BlackRock Frontiers, whose discount increased from 6% to 11%. Another emerging markets trust also made the list: Mobius Investment Trust moved from a 5% discount to an 8.5% discount. 

Other AIC sectors represented this week included private equity (Symphony International Holding with a four percentage point move), European Smaller Companies (Montanaro European Smaller also with a four percentage point move) and UK Equity Income (where Diverse Income Trust's discount increased by around 2.5 percentage points).  

The largest discount on this week’s Discount Delver list is Symphony International Holding (42.4% discount), followed by Schroder European Real Estate Investment Trust (38.8% discount) and then JPMorgan Global Core Real Assets (24.2% discount).  

Investment trustAIC sectorCurrent discount (%)Discount change (percentage point)*
BlackRock Frontiers (LSE:BRFI)Global Emerging Markets-11.10-5.36
Symphony International Holding (LSE:SIHL)Private Equity-42.40-4.24
Montanaro European Smaller (LSE:MTE)European Smaller Companies-16.82-3.96
Weiss Korea Opportunity (LSE:WKOF)Country Specialist-7.92-3.70
Mobius Investment Trust (LSE:MMIT)Global Emerging Markets-8.45-3.29
M&G Credit Income Investment (LSE:MGCI)Debt - Loans & Bonds-4.82-3.01
Diverse Income Trust (LSE:DIVI)UK Equity Income-7.27-2.66
Schroder European Real Estate Investment Trust (LSE:SERE)Property - Europe-38.83-2.59
Pantheon Infrastructure (LSE:PINT)Infrastructure-21.96-2.50
JPMorgan Global Core Real Assets (LSE:JARA)Flexible Investment-24.26-2.49

Source: Morningstar. *Data from close of trading 21 December 2023 to close of trading 28 December 2023.

These articles are provided for information purposes only.  Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties.  The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.

Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.