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ii Super 60 - City of London IT

ii Super 60 investments

ii Super 60 investments:
City of London IT

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Asset Group Asset Sub-Group Investment Category
Equities UK equity income Income

Selection rationale:
City of London remains a compelling core option for investors. It has a formidable reputation as an income-producing investment trust and in July 2020 notched its 54th consecutive year of rising dividends. Job Curtis has been managing the strategy for 29 years, a length of tenure that is exceptionally rare.

Curtis focuses on high-yielding, cash-generative businesses and initiates performance by taking relatively small bets away from the index, rather than aggressive sector and stock positioning.

As head of value and income at Janus Henderson Investors, Curtis looks for companies undervalued on a medium-term basis that he can invest in over the long term. He has, however, been focusing on overseas earners rather than UK domestic names, despite the former’s valuations being higher, given what he views as an unprecedented level of economic uncertainty in the UK.

The portfolio is well diversified with around 100 holdings. The manager likes to run his winners, so portfolio turnover is low. Shares in the trust typically trade at a small premium to net asset value. Investors benefit from the trust’s very low costs. This is one of the largest of the UK equity income trusts with one of the lowest ongoing charge ratios of 0.39%.

In an interview with interactive investor in mid-August, Curtis outlined the changes he has been making to the portfolio in recent months in response to the challenging market backdrop.

Shares in the trust currently have a yield of 6%, and pay a quarterly dividend.

Please note: As a result of recent extreme economic conditions, many companies have temporarily stopped paying dividends or have significantly reduced the amount they are paying out. This means the income that is likely to be achieved by funds and trusts in the near future may be far less than the historic yield quoted in the portfolios.

September 2020

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Risk warnings

Past performance of the underlying constituents is not a guarantee of future performance. The value of investments, and any income from them, can fall as well as rise so you could get back less than you invest. 

Annual performance can be found on the factsheet of each fund, trust or ETF. Simply click on the asset’s name and then the performance tab. 

The information we provide in the ii Super 60 investments list is an opinion provided by ii or one of its partners on whether to buy a specific investment. Please note that none of the opinions we provide are a “personal recommendation”, which means that we have not assessed your investing knowledge and experience, your financial situation or your investment objectives. Therefore you should ensure that any investment decisions you make are suitable for your personal circumstances.

If you are unsure about the suitability of a particular investment or think that you need a personal recommendation, you should speak to a suitably qualified financial advisor. 

Any changes to the ii Super 60 investments list and the rationale behind those decisions will be communicated through the Quarterly Investment Outlook.

Details of all recommendations issued by ii during the previous 12 month period can be found here.

ii adheres to a strict code of conduct. Members of ii staff may hold shares in companies mentioned in the ii Super 60 investments list, which could create a conflict of interest. Any member of staff intending to complete some research about any financial instrument in which they have an interest are required to disclose such interest to ii. We will at all times consider whether such interest impairs the objectivity of the recommendation.

In addition, staff involved in the production of this ii Super 60 list are subject to a personal account dealing restriction. This prevents them from placing a transaction in the specified instrument(s) for five working days before and after an investment is included or amended and made public within the list. This is to avoid personal interests conflicting with the interests of the recipients of this ii Super 60 investments list.