Fund Research

AVI Global Trust

Last update 07 May 2019

AVI Global Trust is a client of Kepler Trust Intelligence. Material produced by Kepler Trust Intelligence should be considered as factual information only and not an indication as to the desirability or appropriateness of investing in the security discussed.

Please see the important information by following this link or at the bottom of the page.

Investment objective

British Empire's investment objective is to achieve capital growth through a focused portfolio of investments, particularly in companies whose share prices stand at a discount to estimated underlying net asset value.

As at:

06/05/2019

Group/Investment

British Empire

Ticker

BTEM

Management Company

Asset Value Investors

Manager Name

Joe Bauernfreund

Association of Investment Companies (AIC) Sector

Global

12 Mo Yield

1.6%

Dividend Distribution Frequency

Semi-Annually


Latest Market Capitalisation

£815,148,465

Latest Net Gearing (Cum Fair)

9%

Latest Ongoing Charge Ex Perf Fee %

0.86

Turnover Ratio %

37.7

Shares Outstanding

110,904,553

(Discount)/ Premium % (Cum Fair)

-8.9

Daily Closing Price

735p


British Empire Trust (BTEM) has a very long history as a specialist “value” investment vehicle. Over the course of its history, the managers have always aimed to exploit their niche expertise in identifying listed companies which are trading at well below the manager’s estimate of intrinsic value.

Since Joe Bauernfreund took sole responsibility for the portfolio in October 2015, he has significantly concentrated the portfolio, and tried to focus more on ideas which have an identifiable catalyst for a re-rating. Increasingly, the managers look to take a “behind the scenes” activist approach which may help unlock value, or bring forward the catalyst. As we discuss in the performance section, this change has made a tangible improvement to performance.

BTEM’s portfolio of companies offers diversification on a number of levels. First, the underlying holdings of each stock are often highly diversified, meaning that the portfolio is arguably not as concentrated as it looks. Currently, the top ten investments make up 66% of the portfolio, but given these are mainly funds or holding companies with varied portfolios of their own, the top ten underlying holdings represent 20.6%, a level of concentration similar to many traditional equity funds.

In general, the idiosyncratic nature of the strategy means that its fortunes can diverge significantly from global markets, and in fact pigeon-holing the trust is sometimes difficult. Importantly, the trust has very different return drivers from many of its peers.

Following the sell-off in Q4 2018, the weighted average underlying discount of the portfolio is approaching historically wide levels. Clearly part of this is influenced by the portfolio make-up, but it also represents the availability of interesting opportunities the team are finding which have attractive discounts.

Since Joe took over sole responsibility for the trust, performance has measurably improved. After a very strong 2016, the trust has essentially kept up with its benchmark, but is currently lagging global peers over 12 months. On the other hand, it has been considerably less volatile than them, lagging in strong periods for the sector, but falling less far in more difficult periods.

The discount remains wide both in absolute terms, but also relative to other investment trusts. It has certainly narrowed since Joe took sole responsibility for the trust in October 2015, and the performance started to improve. However, the difference between the trust’s discount (9.1%) and the sector average remains wide, with global trusts now trading close to par. This could revert if the world suffers a “growth wobble”, or US interest rates start to rise once again.

William Heathcoat Amory

Important information

AVI Global Trust is a client of Kepler Trust Intelligence. Material produced by Kepler Trust Intelligence should be considered as factual information only and not an indication as to the desirability or appropriateness of investing in the security discussed.

Please see the important information by following this link or at the bottom of the page.

Kepler Trust Intelligence is a website owned and managed by Kepler Partners LLP. Material produced by Kepler Trust Intelligence should be considered a marketing communication, and is not independent research.

This report has been issued by Kepler Partners LLP for communication only to eligible counterparties and professional clients as defined by the Financial Conduct Authority.  Its contents are not directed at, are not to be communicated to, may not be suitable for and must not be relied on by retail clients

The information provided on this website is not intended for distribution to, or use by, any person or entity in any jurisdiction or country where such distribution or use would be contrary to law or regulation or which would subject Kepler Partners LLP to any registration requirement within such jurisdiction or country.  Persons who access this information are required to inform themselves and to comply with any such restrictions. 

The information contained herein has not been prepared in accordance with legal requirements designed to promote the independence of investment research. The information contained in this website is not intended to constitute, and should not be construed as, investment advice. No representation or warranty, express or implied, is given by any person as to the accuracy or completeness of the information and no responsibility or liability is accepted for the accuracy or sufficiency of any of the information, for any errors, omissions or misstatements, negligent or otherwise. Any views and opinions, whilst given in good faith, are subject to change without notice.

This is not an official confirmation of terms and is not a recommendation, offer or solicitation to buy or sell or take any action in relation to any investment mentioned herein. Any prices or quotations contained herein are indicative only.  

Kepler Partners LLP (including its partners, employees and representatives) or a connected person may have positions in or options on the securities detailed in this report, and may buy, sell or offer to purchase or sell such securities from time to time, but will at all times be subject to restrictions imposed by the firm’s internal rules. 

Past performance is not necessarily a guide to the future. The value of investments can fall as well as rise and you may get back less than you invested when you decide to sell your investments. Independent financial advice should be taken before entering into any financial transaction. This website is published solely for informational purposes and has no regard to the specific investment objectives, financial situation or particular needs of any person.  

PLEASE SEE ALSO OUR TERMS AND CONDITIONS

A copy of the firm’s conflict of interest policy is available on request.

Kepler Partners LLP is a limited liability partnership registered in England and Wales at 9/10 Savile Row, London W1S 3PF with registered number OC334771.

Kepler Partners LLP is authorised and regulated by the Financial Conduct Authority.

Fund History: AVI Global Trust

More Research

Welcome to Kepler Trust Intelligence

Kepler Trust Intelligence is authorised in the UK by the Financial Conduct Authority.
Please enter a valid email address
{{item.msg}}
Please enter a valid password
{{item.msg}}
Please enter a valid email address
{{item.msg}}
Please check your email. If an account exists you'll be sent instructions on how to reset your password.
Kepler Trust Intelligence is authorised in the UK by the Financial Conduct Authority. To ensure that we are able to provide content which is appropriate for you, please tell us a little about yourself.
Please choose an option
{{item.msg}}
Please enter a company name
{{item.msg}}
Please enter a location name
{{item.msg}}
Please choose an option
{{item.msg}}
Please enter a platform
{{item.msg}}
Please choose an option
{{item.msg}}
Please select a range
{{item.msg}}
Please enter a trust
{{item.msg}}
?
The information contained herein is not for distribution and does not constitute an offer to sell or the solicitation of any offer to buy any securities in the United States to or for the benefit of any United States person (being residents of the United States or partnerships or corporations organised under the laws thereof). The investment funds referred to herein have not been registered in the United States under the Investment Company Act of 1940 and units or shares of such funds are not registered in the United States under the Securities Act of 1933.
Please confirm
{{item.msg}}
View an example
Please select an option
{{item.msg}}
See benefits
A free Kepler Trust Intelligence account allows you to access premium content including the ‘Kepler View’ – our verdict on the trusts we cover – and historical research so you can see how our view has changed over time. An account also unlocks useful facilities like the ‘follow’ button which lets you keep track of the trusts you’re interested in and as a logged in user you can also download PDFs of our research, and choose the layout of the page you’re reading to suit your preference. We will not share your details unless you give us permission to do so, and we won’t bombard you with emails – we only send one a week.
Please select an option
{{item.msg}}
Please enter your first name
{{item.msg}}
Please enter your last name
{{item.msg}}
Please enter a valid email address
An account already exists with this email - have you forgotten your password?
{{item.msg}}
Please enter a valid password
{{item.msg}}
Please enter a valid password
{{item.msg}}
Your answers help us to tailor our content to relevant investment trusts, and to ensure that the asset allocation and portfolio strategy research we produce is appropriate to our userbase. We do not share your personal information and your answers are not linked to your identity for marketing purposes.
Need help?

One more thing...

Did you know, you can 'follow' individual trusts on Kepler Trust Intelligence? Use the functions below to set up alerts and we'll send you research and updates on your chosen trusts.

Suggested trusts to follow

Browse all funds
Need help?
Current Site Kepler Trust Intelligence is produced by the investment companies team at Kepler Partners and is the UK’s premier source of detailed qualitative research on investment trusts. Absolute Hedge is a market leading UCITS research database providing proprietary research on funds, themes and strategies in the UCITS space. Kepler Liquid Strategies is a Dublin domiciled UCITS fund platform featuring a number of best-of-breed fund managers. Kepler Partners is a corporate advisory and asset raising boutique specialising in the regulated funds market in Europe and investment trusts in the UK.