The average investment trust discount tightened to 5.4% at the end of March, representing one of the narrowest figures at the end of a quarter the sector has ever seen.
This is tighter than the average discount (ex 3i Group) of 5.8% in Q4 2016, and 8% seen just 12 months ago (see graph), as levels have been helped by positive market conditions and discount control mechanisms (DCMs). According to Winterflood, the narrowing is the result of a number of factors which have influenced the sector in the last decade, reducing the long-run average discount from 9.5% since the start of 1990 to 7.3% over the last ten years. In its quarterly round-up for Q1 2017, the investment trust analysts said: "The average discount is tighter due to buyback programmes, c...
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