Aberdeen Asia Income IT

[bluedonkey]

Most of my investments are in a HYP, and so in UK equities. To gain some diversification I started looking at ITs. My objective was (i)non-UK (ii)a decent yield (iii)not at a premium.

I ended up purchasing Aberdeen Asia Income Fund. It has a yield of 4.2% and a discount of 7%. Put about 2.5% of my portfolio into it. This was simply all the cash I had available to invest at the moment.

[richfool]

Most of my investments are in a HYP, and so in UK equities. To gain some diversification I started looking at ITs. My objective was (i)non-UK (ii)a decent yield (iii)not at a premium.

I ended up purchasing Aberdeen Asia Income Fund. It has a yield of 4.2% and a discount of 7%. Put about 2.5% of my portfolio into it. This was simply all the cash I had available to invest at the moment.

BD,
AAIF sounds a fair choice. I have held AAIF along with SOI for several years, and have recently added JAI from the same sector.

Whilst AAIF isn't a top performer in terms of growth, it pays a good dividend (current yield c 4.2%) and I understand the manager is conservative (i.e. doesn't take risks). The trust has low exposure to China (c 4%).

[TCAS]

I've held both AAIF and SOI for around 4 years. I'm not reinvesting dividends, which over that that period have been almost the same in pound terms. On a capital return basis, SOI is up 37% and AAIF is up 4%. Make of that what you will.

SOI has South Korea holdings in Samsung and LG Chem which I don't think AAIF has (or at least nowhere near the same proportion if it does).

[everhopeful]

I have held AAS for some years and am up 464%.

[Dod101]

None of these letters/codes or EPICs mean a thing to me and I do wish posters would spell out at least once the IT they are referring to so as to avoid interested parties from having to go and research the name.

Dod

[richfool]

None of these letters/codes or EPICs mean a thing to me and I do wish posters would spell out at least once the IT they are referring to so as to avoid interested parties from having to go and research the name.

Dod

The name of the IT being discussed (AAIF) is in the title of the topic, - i.e. Aberdeen Asian Income trust.
SOI refers to the Schroder Oriental Income trust, from the same Asia Pacific (exc Japan) sector.

Incidentally, my holding of AAIF is up 32.50% as against SOI being up 37.20%, but both were "Bed and ISA'd" a couple of years back and AAIF topped up once since then; so that rather confuses/thwarts any accurate comparison.

[Dod101]

I assumed that AAIF was the titled trust although the F put me off. SOI (and AAS) I have never heard of and had no idea. Still don't know about AAS.

The point is that all posters need to do is spell out say 'Schroder Oriental Income Trust (SOI)' and then refer to SOI if they must.

It is rude and unhelpful otherwise.

Dod

[everhopeful]

AAS is Aberdeen Asian Smaller Companies Investment Trust. I had seen tickers being used elsewhere on the boards and thought it was usual practice. I would certainly not have intended to be rude and am very sorry if that was the impression given. I am off to the naughty step.

[baldchap]

None of these letters/codes or EPICs mean a thing to me and I do wish posters would spell out at least once the IT they are referring to so as to avoid interested parties from having to go and research the name.

Dod

I can't see a problem.
If someone has taken the time to share an interesting fact or viewpoint, and I think that it is worthwhile investigating further, then the least I can do is take 10 seconds to put the EPIC into any of a dozen financial sites to see what it is.

[bluedonkey]

To be honest I found a plethora of unknown acronyms offputting and didn't follow up the post as fully as I would otherwise have done. But I am new to investment trusts and so may be less familiar than others with the candidates.

[BrummieDave]

I'm with Dod on this although not sure I'd have said it was rude, although for those of us relative newbies trying to gather knowledge it does smack slightly of elitism, as with the use of all jargon across many industries. Those in the know proving they are etc.

The purpose of a discussion board is to discuss and share views. I sometimes read threads and have to keep opening another tab to see what IT is being discussed. I'd have thought an appropriate etiquette would be to name the IT when it's first referred to with the code in brackets, then use the code for subsequent mentions if you must.

Happy Christmas by the way (BTW)!

Moderator Message:
Indeed that is the appropriate etiquette, and posters ought to do it as a matter of course. We are often guilty of assuming that an EPIC is sufficient on its own.

Thank you for bringing it up.

TJH

[MDW1954]

AFAIR the problem with AAS is the TER/OC, standing at almost 1.5%.

Merry Christmas, everyone.

MDW1954

[Wizard]

Most of my investments are in a HYP, and so in UK equities. To gain some diversification I started looking at ITs. My objective was (i)non-UK (ii)a decent yield (iii)not at a premium.

I ended up purchasing Aberdeen Asia Income Fund. It has a yield of 4.2% and a discount of 7%. Put about 2.5% of my portfolio into it. This was simply all the cash I had available to invest at the moment.

BD,
AAIF sounds a fair choice. I have held AAIF along with SOI for several years, and have recently added JAI from the same sector.

Whilst AAIF isn't a top performer in terms of growth, it pays a good dividend (current yield c 4.2%) and I understand the manager is conservative (i.e. doesn't take risks). The trust has low exposure to China (c 4%).

My bold.

I am looking at adding ITs to diversify my existing uk equity portfolio and plan to add at least one Asia ex Japan IT. Having had an initial trawl JP Morgan Asian IT (JAI) is of interest, as it was mentio ed here I wondered if there were any strong views on it one way or the other.

Thanks in advance,
Terry.

[richfool]

I am looking at adding ITs to diversify my existing uk equity portfolio and plan to add at least one Asia ex Japan IT. Having had an initial trawl JP Morgan Asian IT (JAI) is of interest, as it was mentio ed here I wondered if there were any strong views on it one way or the other.

Thanks in advance,
Terry.

Wizard, I picked JAI because it targets capital growth as well as income, and will use capital growth to subsidise that income. I took the view therefore that it targets/holds different (more growth focused) stocks than the other two IT's mentioned (AAIF & SOI).
It could be argued that in the event of a downturn the capital value could be more adversely affected.

Extract from Factsheet on H&L website

INVESTMENT OBJECTIVE AND POLICY
Aims to provide capital growth from a diversified portfolio of around 50
to 80 companies quoted on the Asian stock markets, excluding Japan.
The Company amended its distribution policy for the year commencing 1
October 2016. The Company pays quarterly dividends equivalent to 1%
of its net asset value, set on the last business day of each financial
quarter. The Company also has the ability to use gearing up to a
maximum level of 20% of net assets to increase potential returns to
shareholders.

http://www.hl.co.uk/shares/shares-searc ... nt-ord-25p

I hold AAIF, SOI and JAI.

[bonrepos]

Hi Wizard

I bought JAI after they announced that their new policy was to pay 4% yield from dividends and capital.
The discount was about 12% at the time. Its now about 10% so I still think its worth buying. The performance
history is encouraging and I find ,in very general terms, that once an IT raises its yield significantly the discount
tends to narrow.

A previous example of this was JP Morgan Global Growth and Income IT ( JPGI ) which announced a similar policy
of paying a 4% yield. At that time the discount was about 11% and now the share price is at a premium to NAV.

I find , on average, that the higher the yield the less the historical return. It all depends where you are on the investor
cycle!

[tramrider]

Hi Wizard

I bought JAI after they announced that their new policy was to pay 4% yield from dividends and capital.

Although the mathematical yield is 4% per annum, it 'feels' better than that. If the NAV increases each quarter, so does the 1% quarterly dividend. The last 4 quarterly dividends have been 3.1p, 3.4p, 3.6p, 3.8p. This is great dividend growth!

Tramrider

[UncleEbenezer]

This is great dividend growth!

It's called a bull market. Great so long as you don't come to rely on it.

Come the next bear, will the dividend fall back again, or will it look oversized and eat into capital?

[tramrider]

This is great dividend growth!

It's called a bull market. Great so long as you don't come to rely on it.

Come the next bear, will the dividend fall back again, or will it look oversized and eat into capital?

Hi, UncleE,

They have made no promises to keep the dividend up and I don't think they have any dividend reserve as they pay out more than the dividends they receive. I think the dividend would fall back in line with the NAV so a crunch fall of 30% in the NAV, and also probably the JAI share price, should produce a 30% fall in the dividends while maintaining the 4% yield. But this might feel better than a more drastic 'Carillion effect'.

Tramrider