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Twentyfour Select Income Trust (SMIF)

General discussions about equity high-yield income strategies
yieldhog
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Twentyfour Select Income Trust (SMIF)

#351910

Postby yieldhog » October 30th, 2020, 9:43 am

I note that SMIF increased it's latest monthly dividend from 0.50p to 0.6382p.
Has anyone seen any comments from the trust about the increase?
Is it a one-off adjustment or a new monthly pay-out level?

Y

yieldhog
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Re: Twentyfour Select Income Trust (SMIF)

#351969

Postby yieldhog » October 30th, 2020, 1:17 pm

On checking the Trust's dividend history I see this is an annual event to adjust the 12th monthly payment.
Still, glad to see it was over the usual 0.50p.
Y

Laughton
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Re: Twentyfour Select Income Trust (SMIF)

#351980

Postby Laughton » October 30th, 2020, 2:42 pm

Me too.
But as I'm assuming that you've held these longer than me I wonder what your take is on the Tender Offer, this received recently from HL:

TwentyFour Select Monthly Income Fund Ltd has announced details of a Quarterly Tender Offer. You have two options to consider before our noon on Monday 30 November 2020 deadline.
The Company has announced it intends to purchase up to 20% of the issued Share Capital at a price based on the Net Asset Value (NAV). The Tender Price will be set at a 2% discount to the 31 December 2020 NAV. Tender elections in excess of your Basic Entitlement may be subject to pro rata scaling back.

I bought in here as a way to gain access to fixed income otherwise not really available to private investors. Personally, I'm very happy with the yield and would rather they used available excess capital to invest in more of the same, or similar or, if really necessary pay a special dividend rather than buying back shares.

Any thoughts/insights?

yieldhog
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Re: Twentyfour Select Income Trust (SMIF)

#352787

Postby yieldhog » November 2nd, 2020, 7:10 pm

Laughton,

I've owned SMIF for about four years now and I'm averaged-in at a price a bit below 92. Currently sitting on a capital loss of just under 10% but running yield has more than made up for that. As primarily an income investor (retired and in my 70s) I'm not too concerned about the paper loss of capital so long as an acceptable level of income continues for the forseeable future. As far as SMIF is concerned, I'm fairly confident the income will continue to be acceptable.

One of the recently stated objectives of SMIF is to generate at least 6% for shareholders, which on current NAV is around 5.19p per annum, or 0.43p per month, somewhat below the current 0.50p pm payout level.
Another objective is to reduce the risk of it's shares trading at a discount and they say the quarterly tender offer is meant to support that objective. Judging by the fund's performance since launching in 2014, it's largely achieved that objective. Also, I believe they have recently indicated they can buy back up to 20% of the shares, which might actually improve earnings per share for the remaining shareholders.

One of the things I like about SMIF is that it doesn't use gearing to enhance yield, although they can borrow to manage liquidity. This sets them apart from similar high yield funds like NCYF and IPE (both of which I also own).

With another lockdown about to begin I guess we might see even more bankrupcies than originally expected but it does look as though SMIF's portfolio is fairly well positioned in sectors less badly affected than most. For example, they are heavy in financials, many of which have, so far, benefitted from the pandemic. Whether they continue to do so as unemployment rises sharply is open to question.

Overall, SMIF looks well-managed and well-positioned to weather the storm and I plan to keep it in my portfolio.

Y

Laughton
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Re: Twentyfour Select Income Trust (SMIF)

#352813

Postby Laughton » November 2nd, 2020, 10:06 pm

Many thanks.
I only started buying in this year and am happy to continue holding.
No plans to tender any shares for the buyback.

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Re: Twentyfour Select Income Trust (SMIF)

#354709

Postby DiviLuvva » November 9th, 2020, 10:25 am

The 12th interim last year was 0.84293p, in 2018 it was 1.04962p and in 2017 1.0614p. So it's actually a reduction I'm afraid.

yieldhog
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Re: Twentyfour Select Income Trust (SMIF)

#371289

Postby yieldhog » December 30th, 2020, 3:15 pm

I notice the second SMIF interim dividend went xd on December 17th for payment on January 5th, whereas normal payment is at the end of the month in which it goes xd. I don't think there's any great significance in this since they've paid two interims in the same month before. The payment of 0.50p is consistent with previous months and with guidance given in the last interim report. I would expect to see another interim of 0.50p at the end of January.

I thought the interim report was quite positive and believe things are working out quite well for SMIF. Some of the positives were:
- The fund does not use gearing to enhanceyield.
- The Portfolio Manager appears to be confident of maintaining a dividend of 6p or more for the current FY.
- The pandemic has created a lot of opportunities to increase yields and improve quality on the portfolio.
- Gross yield is expected to rise to 13% or more.
- New shares were issued at a premium to NAV and over £15m new money raised.
- The fund has been able to lock in higher yields for a longer period.
- The fund does not expect any losses to result from the pandemic.

Baring any significant new problems, it looks to me as though the SMIF share price could return consistently to the 100p level and premium pricing we saw 2 - 3 years ago. Indeed, just before the pandemic took hold earlier this year, it was trading around the 99p level.

As discussed extensively on TLF and elsewhere, the fly in the ointment for all fixed income portfolios is the threat of higher inflation and we all have our own opinions on that subject. We can't ignore it, but what you do about it will depend on each individual's personal circumctances and objectives.

Good luck and a Happy New Year to all.

Y.

yieldhog
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Re: Twentyfour Select Income Trust (SMIF)

#373710

Postby yieldhog » January 6th, 2021, 9:04 am

Back in December the Scheduled December 30th SMIF dividend payment date was changed to January 5th, 2021. That date has now passed and I still haven't got the payment in my SIPP.
Has anyone got the payment yet or know why it's been delayed?
Y

yieldhog
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Re: Twentyfour Select Income Trust (SMIF)

#373716

Postby yieldhog » January 6th, 2021, 9:28 am

Just got an email from my SIPP provider that dividend has been paid, dated January 5th. Not sure where the delay occurred as dividends usually arrive on the scheduled date, not the day after.
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Re: Twentyfour Select Income Trust (SMIF)

#373894

Postby Peltiq » January 6th, 2021, 3:24 pm

yieldhog wrote:Just got an email from my SIPP provider that dividend has been paid, dated January 5th. Not sure where the delay occurred as dividends usually arrive on the scheduled date, not the day after.
Y

The payment date was yesterday so it appears you were paid correctly.

https://www.investegate.co.uk/twentyfou ... 5037P5CDA/

The dividend date is usually the last day of the month but this changes every now and again (about once a year) for no obvious reason. Presumably the next div will be 50p paid on Friday 29th Jan.

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Re: Twentyfour Select Income Trust (SMIF)

#373901

Postby Ricksure » January 6th, 2021, 3:38 pm

Dividend data shows the ex-dividend date as 17 December 2020 with the pay date as 5 January 2021 and was in my SIPP account last night

https://www.dividenddata.co.uk/ex-divid ... hTerm=smif

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Re: Twentyfour Select Income Trust (SMIF)

#373939

Postby Laughton » January 6th, 2021, 4:28 pm

Received into my iDealing account today.

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Re: Twentyfour Select Income Trust (SMIF)

#374511

Postby Ricksure » January 7th, 2021, 8:38 pm

The next dividend is 0.5p ex-dividend date 14 January 2021 and the pay date 29 January 2021


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