Shares in some of London's best-performing investment trusts over the past decade are currently trading on double-digit discounts to the value of their assets.
The average investment company discount to net asset value (NAV) has widened to above 15%, up from 12% at the end of last year and 14% in the summer - though several subsectors have seen discounts narrow.
Allianz Technology Trust PLC (LSE:ATT) is the best-performing investment company where the shares are currently available for a double-digit discount, according to data from the Association of Investment Companies (AIC).
It has delivered a near-fivefold return to investors over the past decade and is trading on a 13.5% discount.
Another tech investor Polar Capital Technology Trust PLC (LSE:PCT) in the third-best performing on a share price total return basis over 10 years, but still with its shares at an 11% discount to NAV.
In between them in second place is the India Capital Growth Fund Ltd (LSE:IGC), which has achieved a similar ten-year return and trades at a discount of 11.3%.
Company
Share price total return % 1 year · Share price total return % 3 years · Share price total return % 5 years · Share price total return % 10 years · Discount %
All investment companies
1.8 · 13.9 · 74.1 · 140.0 · -16.1
11.4
Allianz Technology Trust · -5.6 · 79.5 · 395.6 · -13.5
29.8
India Capital Growth Fund · 117.9 · 89.8 · 390.5 · -11.3
13.4
Polar Capital Technology · 0.5 · 79.9 · 366.3 · -14.2
10.2
HgCapital Trust (LSE:HGT) · 35.0 · 109.9 · 351.5 · -22.1
2.6
NB Private Equity Partners · 69.7 · 75.2 · 321.8 · -30.5
14.2
VietNam Holding · 95.8 · 51.8 · 295.2 · -14.1
2.5
VinaCapital Vietnam Opp Fund · 45.4 · 57.3 · 288.1 · -21.1
-13.5
Scottish Mortgage · -37.6 · 37.4 · 259.1 · -17.1
-3.2
HarbourVest (LSE:HVPE) Global Private Equity · 24.6 · 54.4 · 246.5 · -47.3
17.2
230.5
-36.0
CT Private Equity Trust · 80.6 · 65.2
-3.7
Alpha Real Trust (AIM:ARTL) · -13.7 · 5.9 · 230.5 · -40.6
-3.6
Pacific Horizon · -16.6 · 79.2 · 225.2 · -11.7
16.6
Dunedin Enterprise · 118.4 · 100.2 · 222.8 · -15.6
12.7
Oryx International Growth · -1.8 · 31.1 · 213.2 · -33.6
-11.7
Lindsell Train · -17.9 · -16.7 · 209.2 · -13.0
8.7
abrdn Private Equity Opportunities · 51.7 · 50.4 · 204.6 · -44.4
0.8
3i Infrastructure · 11.7 · 40.2 · 193.0 · -12.7
13.6
Oakley Capital Investments · 70.9 · 148.2 · 189.3 · -36.0
15.1
Canadian General Investments · 27.4 · 61.7 · 179.0 · -36.4
19.0
Pantheon International · 39.8 · 40.1 · 178.6 · -38.1
Source: theaic.co.uk / Morningstar (data as at 20/10/23)
There are some themes, as is apparent in the table above, with eight private equity sub-sector trusts as well as those with notable exposure to privates in their portfolio, such as with Scottish Mortgage Investment Trust PLC (LSE:SMT).
Private equity trusts are among those with the biggest discounts to NAV as investors have fretted over the end of cheap money for PE firms as interest rates have climbed, with the City regulator reportedly preparing to launch a review into how private equity funds carry out their valuations.
The fourth and fifth best performers on discounts wider than 10% are both private equity investment companies, HgCapital Trust (LSE:HGT) on a 22.1% discount and NB Private Equity Partners even larger.
Private equity is the sector that features most heavily in the list, accounting for eight of the top 20 companies, of which six have discounts topping 30%.
Also prominent are a pair of Vietnam-focused trusts, VietNam Holding Ltd (LSE:VNH) and VinaCapital Vietnam Opportunity Fund Limited (LSE:VOF) with among the best long-term performances but currently sitting at respective discounts of 14.1% and 21.1%.