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Murray International - dog or not?

Closed-end funds and OEICs
Avantegarde
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Murray International - dog or not?

#116298

Postby Avantegarde » February 7th, 2018, 11:16 am

Why is Murray International still regarded so highly? Statistics from FE Trustnet show that in the past five years the total return on this IT has been 37%, while that of the comparable FTSE World ex-UK index has been far higher at 89%. MI has been by far the worst performer of all my portfolio's international ITs. Now, in the five years I have held it I haven't actually lost any money. A 37% return in five years is not to be sniffed at. But was there any point in holding it when I could have achieved a much better return, at much lower cost, via a tracker fund for that particular index? Of course, when I established my portfolio of 15 ITs I didn't know which would do better than the others - the whole point was to spread risk, anticipating that some would indeed do better than others. It just so happens that MI has been the dog. But underperforming a relevant index by more than 50% is pretty rank, don't you think? Should I stick with MI or dump it now in favour of that tracker fund?

Dod101
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Re: Murray International - dog or not?

#116304

Postby Dod101 » February 7th, 2018, 11:38 am

I think it depends why you hold it. I hold it for income as much as anything else and in that regard it has done pretty well. Of course with most ITs you tend to trade some capital growth for the income but that suits me fine.

It had a couple of 'off' years during your five year period but it has recovered well since then.

Dod

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Re: Murray International - dog or not?

#116311

Postby Bluestone77 » February 7th, 2018, 12:06 pm

Looking at the last annual report (to 31/12/16), which I realise is not that up to date, the performance data shows it has outperformed its benchmark (see p11 of the report) over a 10 year period.
Share Price: +184%
NAV: +152%
Benchmark: +114%
Figures include income reinvested.
The benchmark is a composite index comprising 40% of the FTSE World UK Index and 60% of the FTSE World ex-UK Index.

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Re: Murray International - dog or not?

#116320

Postby kempiejon » February 7th, 2018, 12:36 pm

And currently available at a discount to NAV - a sight not often seen recently if memory serves. Those income seekers like Dod would probably find the 4.xx% yield attractive and the rate of dividend growth has been above inflation for ages if not ever.
I hold and have considered adding but decided to hold fire.

Now Murray Income Trust might be a bit more of a MUTt, I've held over 10 years and mostly saw stagnant and then decline in capital until last year.

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Re: Murray International - dog or not?

#116378

Postby BrummieDave » February 7th, 2018, 3:36 pm

Like previous threads on similar subjects, it comes down to the old chestnut of TR versus Income.

There aren't many global income biased ITs to choose from, but MYI does the business if you want a steady flow of income at a decent yield. Others beat it easily on a TR basis and if you're willing to do the work and top slice every quarter, that's one option. Also it gives exposure to non blue chips, globally. Again, may not suit everyone, but as part of a balanced portfolio...you know the rest!

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Re: Murray International - dog or not?

#116454

Postby Avantegarde » February 7th, 2018, 8:56 pm

BrummieDave wrote:Like previous threads on similar subjects, it comes down to the old chestnut of TR versus Income.

There aren't many global income biased ITs to choose from, but MYI does the business if you want a steady flow of income at a decent yield. Others beat it easily on a TR basis and if you're willing to do the work and top slice every quarter, that's one option. Also it gives exposure to non blue chips, globally. Again, may not suit everyone, but as part of a balanced portfolio...you know the rest!


Dividends from Murray International have risen on average by 2.9% during each of the past five years (say the AIC stats). So slightly ahead of RPI during that time. Is that good enough?

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Re: Murray International - dog or not?

#116536

Postby BrummieDave » February 8th, 2018, 9:37 am

It is for me, it's my third largest holding.

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Re: Murray International - dog or not?

#116540

Postby Dod101 » February 8th, 2018, 9:54 am

Avantegarde wrote:
BrummieDave wrote:Like previous threads on similar subjects, it comes down to the old chestnut of TR versus Income.

There aren't many global income biased ITs to choose from, but MYI does the business if you want a steady flow of income at a decent yield. Others beat it easily on a TR basis and if you're willing to do the work and top slice every quarter, that's one option. Also it gives exposure to non blue chips, globally. Again, may not suit everyone, but as part of a balanced portfolio...you know the rest!


Dividends from Murray International have risen on average by 2.9% during each of the past five years (say the AIC stats). So slightly ahead of RPI during that time. Is that good enough?


You are quite right to question your holdings but Murray International is just that an international trust producing a steadily increasing income at a decent level. It provides me with diversity and an income of around 4% per annum. I am very happy to hold it on that basis. You may not be and only you can decide but I would certainly not call it a dog and it seems there are quite a few others who agree with me.

Dod

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Re: Murray International - dog or not?

#116561

Postby SalvorHardin » February 8th, 2018, 10:57 am

Avantegarde wrote:Dividends from Murray International have risen on average by 2.9% during each of the past five years (say the AIC stats). So slightly ahead of RPI during that time. Is that good enough?

Ah, the perils of using summarised data :D The dividend growth is a bit more than 2.9% per annum.

Since we haven't yet had the full 2017 dividend I'll start with the previous year. So that's a 2016 dividend of 47.5p versus a 2011 dividend of 37.0p. The compound annual growth here is 5.1% over five years (the dividend figures come from the 2016 annual report).

Whilst we haven’t yet received all of the 2017 dividend I would expect this to be at least 49p (it has paid 33p in the first three quarters and the final dividend in 2016 was 16p). The 2012 dividend was 40.5p. So that represents 3.9% per annum compound growth over 5 years.

As to the performance in recent years, a major contributor to the relatively poor capital growth has been the elimination of the substantial premium to NAV. Murray International has tended to trade at a very big premium; for example, the link below refers to an article from July 2015 which refers to a recent premium of 9% having slipped to a 0.4% discount. I bought my shares in September 2016 when they briefly went to a discount.

http://www.telegraph.co.uk/finance/pers ... ncome.html

Bear in mind that a lot of investors hold Murray International because it pays a high income; capital growth is nice but not their main objective.

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Re: Murray International - dog or not?

#117152

Postby Bouleversee » February 10th, 2018, 3:32 pm

I gather that MYI has 10% gearing but invested much of it in bonds and property rather than shares. I wonder what sort of property. Anyone know?

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Re: Murray International - dog or not?

#117300

Postby jackdaww » February 11th, 2018, 11:39 am

BrummieDave wrote:Like previous threads on similar subjects, it comes down to the old chestnut of TR versus Income.

There aren't many global income biased ITs to choose from, but MYI does the business if you want a steady flow of income at a decent yield. Others beat it easily on a TR basis and if you're willing to do the work and top slice every quarter, that's one option. Also it gives exposure to non blue chips, globally. Again, may not suit everyone, but as part of a balanced portfolio...you know the rest!


=====================
a short list of your others beating it on TR would be greatly appreciated.

many thanks

:)

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Re: Murray International - dog or not?

#117315

Postby kempiejon » February 11th, 2018, 12:39 pm

jackdaww wrote:
BrummieDave wrote:Like previous threads on similar subjects, it comes down to the old chestnut of TR versus Income.

There aren't many global income biased ITs to choose from, but MYI does the business if you want a steady flow of income at a decent yield. Others beat it easily on a TR basis and if you're willing to do the work and top slice every quarter, that's one option. Also it gives exposure to non blue chips, globally. Again, may not suit everyone, but as part of a balanced portfolio...you know the rest!


=====================
a short list of your others beating it on TR would be greatly appreciated.

many thanks

:)


Joking noted, in my IT mix iii and Scottish Mortgage Trust have both had very good runs for me, I've held for a few years along with City and both the Murray's.

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Re: Murray International - dog or not?

#117324

Postby Dod101 » February 11th, 2018, 1:01 pm

Bouleversee wrote:I gather that MYI has 10% gearing but invested much of it in bonds and property rather than shares. I wonder what sort of property. Anyone know?


The half year report to 30 June showed gearing of 10.8% and in its assets, about 19% in fixed income, presumably that is mostly bonds and is providing a guaranteed income to help support the dividend. So you could say that its gearing is entirely invested in fixed income.

The Annual Report for 2017 will no doubt soon be available and we can get a more up to date picture then.

Dod

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Re: Murray International - dog or not?

#117346

Postby BrummieDave » February 11th, 2018, 2:51 pm

jackdaww wrote:
=====================
a short list of your others beating it on TR would be greatly appreciated.

many thanks

:)


You may have read my comment differently than I wrote it. I hold MYI as it gives me what I need, a steady income at a decent yield. A quick scan on Trustnet at their list of 'Global Equity Income' ITs would show which beat MYI on a TR basis, as would their broader 'Global' list, but I think you probably know that already.

So I don't have a list of my others, as I'm not a TR bias investor. ;)

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Re: Murray International - dog or not?

#117405

Postby scotia » February 11th, 2018, 6:24 pm

a short list of your others beating it on TR would be greatly appreciated.


Assuming that the Murray International Trust (MYI) is a Global Income based trust, I had a look at an OEIC with a similar remit which I used to favour - namely Newton Global Income. The 5 year return is 63.69% (Newton) and 33.67% (Murray). The Murray IT performed particularly badly from October 2014 to February 2016 - going down while the Newton Fund went up. Over the past 18 months, the Murray IT has recovered some of the lost ground. The historic yield from the Newton fund is around 3.1%
The Fidelity Global Dividend OEIC has performed similarly to the Newton Fund. Its historic yield is around 2.8%
The Fidelity Global Enhanced Income OEIC has also performed similarly to the Newton Fund (but with only 4.5 years history). Its historic yield is around 4.1%
However if you restrict your horizon to the past eighteen months - then the Murray IT wins.

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Re: Murray International - dog or not?

#141912

Postby richfool » May 28th, 2018, 4:43 pm

I've just been re-reading a couple of older threads which included this one about MYI and its lack of capital growth, compared to many of its peers. Noting that it holds a proportion of bonds and is managed by Bruce Stout, I tend to think that it has an element of capital preservation about it (as well as an above average dividend yield). Would fellow fools concur re the capital preservation tendencies?

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Re: Murray International - dog or not?

#141932

Postby SalvorHardin » May 28th, 2018, 6:16 pm

richfool wrote:I've just been re-reading a couple of older threads which included this one about MYI and its lack of capital growth, compared to many of its peers. Noting that it holds a proportion of bonds and is managed by Bruce Stout, I tend to think that it has an element of capital preservation about it (as well as an above average dividend yield). Would fellow fools concur re the capital preservation tendencies?

Yes. This article from 2016 with Bruce Stout (the manager) sums up his strategy.

"When I talk to our shareholders and ask what they do with their dividend, they say it goes out of their bank account and pays their gas bill. That shows me that the real dividend is very important.”

If I tell shareholders the market’s down 15 per cent but guess what we’re only down 10, that’s no use to them, they’ve still lost 10 per cent of their money.”


http://www.trustnet.com/news/706304/bru ... and-harder

Roughly 75% of my portfolio is in operating companies, with the rest in investment trusts of which Murray International is one of the larger holdings. Now whilst I am a more optimistic investor than Mr. Stout, I prefer to keep some money with him just in case I am seriously wrong with the rest of my portfolio (as happened in 2008 when I was down almost 50%).

My Murray International dividends just about pay for the gas, electricity and water bills.

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Re: Murray International - dog or not?

#141955

Postby Bouleversee » May 28th, 2018, 7:10 pm

SalvorHardin wrote:
richfool wrote:I've just been re-reading a couple of older threads which included this one about MYI and its lack of capital growth, compared to many of its peers. Noting that it holds a proportion of bonds and is managed by Bruce Stout, I tend to think that it has an element of capital preservation about it (as well as an above average dividend yield). Would fellow fools concur re the capital preservation tendencies?

Yes. This article from 2016 with Bruce Stout (the manager) sums up his strategy.

"When I talk to our shareholders and ask what they do with their dividend, they say it goes out of their bank account and pays their gas bill. That shows me that the real dividend is very important.”

If I tell shareholders the market’s down 15 per cent but guess what we’re only down 10, that’s no use to them, they’ve still lost 10 per cent of their money.”


http://www.trustnet.com/news/706304/bru ... and-harder

Roughly 75% of my portfolio is in operating companies, with the rest in investment trusts of which Murray International is one of the larger holdings. Now whilst I am a more optimistic investor than Mr. Stout, I prefer to keep some money with him just in case I am seriously wrong with the rest of my portfolio (as happened in 2008 when I was down almost 50%).

My Murray International dividends just about pay for the gas, electricity and water bills.


What happened to your almost 50% loss? How much of that did you recover? Did the dividend income go down and what is your capital situation now? What I am driving at is how much that general drop in 2008 mattered at the end of the day and whether being invested in bonds really helped.

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Re: Murray International - dog or not?

#141963

Postby SalvorHardin » May 28th, 2018, 7:23 pm

Bouleversee wrote:What happened to your almost 50% loss? How much of that did you recover? Did the dividend income go down and what is your capital situation now? What I am driving at is how much that general drop in 2008 mattered at the end of the day and whether being invested in bonds really helped.

My near 50% loss in 2008 was the total portfolio. At that time I didn't own Murray International.

Over the years since I have somewhat toned down my aggressive style and moved more into investments like Murray International. I live off my dividends and don't fancy having to go back to work. Comparing my dividends in 2009 to 2008 is pointless since in 2008-09 I moved a lot from companies with no dividends into companies with dividends.

Since the depths of 2008 I am up by around 300%, most of which came from operating companies.

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Re: Murray International - dog or not?

#141972

Postby Bouleversee » May 28th, 2018, 8:22 pm

"Since the depths of 2008 I am up by around 300%, most of which came from operating companies."


Sounds pretty good to me, especially if you have been spending the dividends. It's the total return that counts. One can always sell off a few high growth shares if the div. income falls short of one's needs.


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