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Edinburgh Investment IT (EDIN) and Perpetual Income and Growth (PLI)

Closed-end funds and OEICs
BrummieDave
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Edinburgh Investment IT (EDIN) and Perpetual Income and Growth (PLI)

#249024

Postby BrummieDave » September 3rd, 2019, 7:56 pm

Back in November 2018 the respective boards of these ITs gave their support to beleaguered Invesco Fund Manager Mark Barnett, whilst also saying he would be under increasing scrutiny given the poor total return of these two investment companies over a prolonged period.

Since November, in very broad terms, I think EDIN has dropped around 13% and PLI around 11%. Over the same period, the FTSE All Share and FTSE 100 are up around 3% as is City of London (CTY) to use this competing UK equity income IT as a yardstick.

Whilst both boards may point to the increase in dividend over this period noting that this is a major part of the mandate they place on the fund manager, the 5 year dividend growth is only 3.3% pa for both ITs (compared to CTY at 4.0%).

As we approach the anniversary of the statements made both the boards, does anyone think either will ever take action, or are they just drifting with Mr Barnett alongside?

Arborbridge
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Re: Edinburgh Investment IT (EDIN) and Perpetual Income and Growth (PLI)

#249028

Postby Arborbridge » September 3rd, 2019, 8:28 pm

I've no idea, but PLI yielding 5% and with the shares it contains at quite a discount - it has to be a temptation for me.

Same goes for Temple Bar, no yielding almost as good as it gets, at over 4%.

Personally, I'm keeping a spread of all of them as I doubt the dividends will be slashed (fingers crossed).

These have to compete with all the single share on offer at rock bottom prices - what will happen to these already bargain basement prices when the stock market crashes?

Arb.

Dod101
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Re: Edinburgh Investment IT (EDIN) and Perpetual Income and Growth (PLI)

#249036

Postby Dod101 » September 3rd, 2019, 9:01 pm

If past experience is anything to go by (and the statement in the Annual Report), I doubt that we will see any action from the Edinburgh Board. I have however written to the Chairman as I think I may have said, urging them to do more than simply 'stepping up the Board's scrutiny of the way that the portfolio is managed'. They could change managers or they could state that they are prepared to pay at least some of the dividend from capital, thus giving the manager more scope to invest in other than HYP like shares where the capital growth has been almost non existent.

I would have sold I think but I have held Edinburgh shares for a very long time and they are held in certificated form so I would have a large CGT bill so I am keeping them at least for the time being.

Dod

BrummieDave
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Re: Edinburgh Investment IT (EDIN) and Perpetual Income and Growth (PLI)

#249045

Postby BrummieDave » September 3rd, 2019, 9:35 pm

Dod101 wrote:If past experience is anything to go by (and the statement in the Annual Report), I doubt that we will see any action from the Edinburgh Board. I have however written to the Chairman as I think I may have said, urging them to do more than simply 'stepping up the Board's scrutiny of the way that the portfolio is managed'. They could change managers or they could state that they are prepared to pay at least some of the dividend from capital, thus giving the manager more scope to invest in other than HYP like shares where the capital growth has been almost non existent.

I would have sold I think but I have held Edinburgh shares for a very long time and they are held in certificated form so I would have a large CGT bill so I am keeping them at least for the time being.

Dod


And I have written to the chair of PLI, twice, but nothing in either reply inspires me. I don't hold EDIN.

Mark Barnett seems to have followed the same route that made his his mentor, Neil Woodford, the star he previously was. That approach now looks out of date and is due a rethink IMHO.

gbjbaanb
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Re: Edinburgh Investment IT (EDIN) and Perpetual Income and Growth (PLI)

#249178

Postby gbjbaanb » September 4th, 2019, 10:18 am

Dod101 wrote:I would have sold I think but I have held Edinburgh shares for a very long time and they are held in certificated form so I would have a large CGT bill so I am keeping them at least for the time being.

Dod


You're going to have to sell them eventually, so might as well start getting rid of just enough to use up each year's CGT allowance. Which means you might want to get them held electronically instead.

Dod101
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Re: Edinburgh Investment IT (EDIN) and Perpetual Income and Growth (PLI)

#249208

Postby Dod101 » September 4th, 2019, 11:17 am

gbjbaanb wrote:
Dod101 wrote:I would have sold I think but I have held Edinburgh shares for a very long time and they are held in certificated form so I would have a large CGT bill so I am keeping them at least for the time being.

Dod


You're going to have to sell them eventually, so might as well start getting rid of just enough to use up each year's CGT allowance. Which means you might want to get them held electronically instead.


Indeed. When I sell any certificated shares (I still have quite few) I transfer them first to an online Trading Account and sell them electronically. I did that with Unilever earlier this year and have incurred a large CGT liability which will more than absorb this year's allowance which is why I do not want to add to that. I have held Unilever for well over 20 years so I had a very large gain. I then transferred back to a certificate those shares I anticipate keeping for the long term as I see no point in exposing myself to a platform any more than I need do.

The irony is that Edinburgh deserves to be sold much more than Unilever.

Dod

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Re: Edinburgh Investment IT (EDIN) and Perpetual Income and Growth (PLI)

#249251

Postby toofast2live » September 4th, 2019, 1:19 pm

DOD, you really consider the risk of platform failure to be that high?

Dod101
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Re: Edinburgh Investment IT (EDIN) and Perpetual Income and Growth (PLI)

#249265

Postby Dod101 » September 4th, 2019, 2:06 pm

I guess this is somewhat off topic but I am talking about shares which I intend to keep indefinitely and which are not in an ISA or a SIPP. I see no point in leaving them in a nominee account, partly because of the exposure to any problem with the platform but also because it gives me the right to get material direct from the company re circulars, notice of AGMs etc as well as the right to attend an AGM. I see that as important. Maybe my previous comment was not full enough but as you can see there are other factors as well. My trading accounts hold only stuff that I would consider selling, not long term buy and hold shares. There is another factor as well which is that I get dividends paid directly into my bank account. There is a lot to be said for holding certificates.

Dod

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Re: Edinburgh Investment IT (EDIN) and Perpetual Income and Growth (PLI)

#249276

Postby gbjbaanb » September 4th, 2019, 3:01 pm

i can get dividends paid into my bank account with most brokers - and I have no problem with holding stocks in cert form, but nearly all of my stocks are held in ISAs and IIRC you can't hold them as certs. The risk of a broker (like iWed, owned by Halifax, owned by Lloyds) seems to be small and much much outweighed by not having to pay tax!

Dod101
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Re: Edinburgh Investment IT (EDIN) and Perpetual Income and Growth (PLI)

#249290

Postby Dod101 » September 4th, 2019, 4:27 pm

gbjbaanb wrote:i can get dividends paid into my bank account with most brokers - and I have no problem with holding stocks in cert form, but nearly all of my stocks are held in ISAs and IIRC you can't hold them as certs. The risk of a broker (like iWed, owned by Halifax, owned by Lloyds) seems to be small and much much outweighed by not having to pay tax!


I completely agree but will say no more as this is definitely off topic.

Dod

monabri
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Re: Edinburgh Investment IT (EDIN) and Perpetual Income and Growth (PLI)

#249358

Postby monabri » September 4th, 2019, 7:53 pm

toofast2live wrote:DOD, you really consider the risk of platform failure to be that high?


It can and has happened recently (SVS Securities).


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