M & G High Income Investment Trust

[OttawaCitizen]

This Trust will wind up in March 2017. The rollover options are all M& G OEIC funds - M& G Distribution Fund, M& G Strategic Corporate Bond Fund and M & G Dividend Fund. I would welcome any opinions on what to do when the Trust winds up - stick with M&G or reinvest elsewhere.

Thanks

Ottawa Citizen

[tramrider]

I am intending to take the cash to invest elsewhere. If we are lucky, the Net Asset Value may be above the current share price, after the redistribution between the different share classes.

Tramrider

[woolly]

For an additional premium (intended to defray costs) of 0.65-1% there is also a closed-ended fund option on offer (in fact, three) from JPMorgan Elect: Managed Growth, Managed Income or Managed Cash shares. According to JP Morgan, "You can convert from one to the other four times a year without incurring a liability to capital gains tax". Annual charge is 0.52%.

Perhaps it's also worth mentioning that the M&G rollover options result in class "R" shares, which apparently have lower annual management charges than the class "A" shares normally available to retail investors.

So in summary, the CGT-free rollover options are:

Closed Funds: options A–C (JPMorgan Elect Managed Growth), (JPMorgan Elect Managed Income), (JPMorgan Elect Managed Cash);
OEICs: options D–F (M&G UK Income Distribution Fund), (M&G Strategic Corporate Bond Fund), (M&G Dividend Fund);

Or there is option G, to take cash and incur any CGT charge arising.

In case anyone hasn't already received it, the necessary winding up and rollover options information (which seems quite complex at first glance) can be found here: https://materials.proxyvote.com/Approve ... 307704.PDF

[hiriskpaul]

I have a small number of the prefs and will be opting for cash. They are in an ISA, so no CGT concerns.

I would point out that M&G are doing their investors no favours by offering them M&G R class units, despite the claims. These R units are more expensive than the clean class I units offered by the various platforms, such as iWeb, Hargreaves Lansdown, etc. The best that can be said is that they are not totally ripping people off by dumping the ludicrously expensive A or X class units on them.

Example ongoing charges for the M&G UK Income Distribution Fund Sterling A Inc:

A class: 1.41%
I class: 0.76%
R class: 1.01%
X class: 1.41%

[penym]

I have this particular investment and want the money to be put into my bank account. I am not in UK during the period of the closing of this IT. I have with me my share certificate. I am presuming that I send the original share certificate to Equiniti with a letter of instruction to pay the proceeds into my bank account.

Should I send the certificate back now or wait until March?

Advice would be appreciated.

Anniel

[PinkDalek]

I have this particular investment and want the money to be put into my bank account. I am not in UK during the period of the closing of this IT. I have with me my share certificate. I am presuming that I send the original share certificate to Equiniti with a letter of instruction to pay the proceeds into my bank account.

Should I send the certificate back now or wait until March?

Advice would be appreciated.

Anniel

Does this assist "Wind-up of the M&G High Income Investment Trust"?

http://www.mandg.co.uk/investor/article ... -the-hiit/

Briefly it includes "Please note that your instructions must reach us no later than 5pm on Thursday 2 March 2017. Should we not hear from you by then, your investment will be moved into M&G UK Income Distribution Fund R Income Shares".

You therefore need to elect for the cash option using the appropriate form which should be in a brochure, if it is sent to you.

The procedures may differ If you invest in HIIT directly (not through an M&G ISA) or If you invest in HIIT through an M&G ISA and you should see separate links on the page above for each of those.

Perhaps you might wish to avail yourself of If you have any questions which are not answered in the Questions section, please call Customer Relations on 0800 390 390.

[woolly]

I would point out that M&G are doing their investors no favours by offering them M&G R class units, despite the claims.

Thanks for pointing that out - puts the JP Morgan option in perspective.

None of the rollover options are particularly attractive, I agree - will probably opt for cash.

[Bouleversee]

My late husband held this IT in an ISA (bought the only time we ever used a financial adviser) and, although I advised him of his death in November and sent the death certificate and told them I was his executor, they addressed the covering letter (which mentioned his death) and the information pack about the wind-up to him and all the forms have his name on them. I had received a valuation as at date of death (£10,610.21) which also stated that a dividend of £107.45 would be paid on 25 Nov. The sum paid into the bank was, however, only 99.39; they now say the difference is the account charges due, which seems rather a high percentage. They had previously sent me a booklet titled "When an M&G investor dies" , which contained the following statement: "If the estate is small, you may not need a Grant of Representation. Different companies have different definitions of 'small' In our case it is where the total value of the M&G investment is £36,000 or less, regardless of the value of the total estate. You would think, therefore, that I could ask for cash now but they are now saying that since I will be applying for probate, I will have to wait till I can send them the grant of representation (which may be a long way off as there is much to consider) before releasing any cash, and if I choose the cash option re the wind-up, the money will sit there not earning any interest till I do send them the sealed grant. If I opt for a fund, any income will be reinvested in the fund, as will be happening now, and apparently my husband's name will stay on the investment. All very unsatisfactory.

So it looks as though I shall have to opt for a fund, no idea which would be best for a short term. I read an article saying their charges were very high, as are Jupiter's, another investment bought through the adviser at the same time, and I don't in any case want small pots dotted around as I may end up passing it on to children or grandchildren. Assuming there was no difference between the value of the units at the time of the wind-up and switch and at the date of sale, would I still get less than if I took the cash at the wind up? I don't hold any unit trusts of investment trusts myself and don't know how spreads work in these cases. I am certainly not impressed by M&G so far.

[penym]

Sorry for being so late in proffering my thanks for your help PD. I am going to ring them before I act.

Why can't we rec. people on Lemon Fool?

Anniel