Striving towards a narrow discount in the long term

investment trusts

Narrow discounts can be achieved on investment trusts by convincing investors they can be maintained, and regular marketing, broader share ownership, share buybacks and treasury shares are good ways to do this

Proper discount control combined with strong investment performance can make investment trusts an irresistible force in the savings market. After receiving reports of its own demise for many years, the investment trust sector is proving once again that it is very much alive. Over the last six months the average discount to net asset value (NAV) across the whole investment trust sector has narrowed dramatically from almost -14% to just under -10%, according to broker Close WINS. Furthermore, since mid-2000, the average discount has never dropped below -14%, leading some to suggest that it h...