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Re: Law Debenture Corp (LWDB)? Any LWDB fans in the house?

Posted: July 2nd, 2020, 8:03 am
by Arborbridge
Image

Showing how LWDB TR over ten years compares with DIG,MUT and CTY. I'm glad to have bought and held LWDB for longer than that as it's done rather well, despite the fact that it is an oddball. Interesting to note that MUT and DIG were dogs, but picked up after the Brexit referendum so they got something right, or got lucky. Which all goes to show that one can choose the wrong supermarket queue even if it looks shorter! (ps. I mean, I sold the dogs but held on to CTY!)

My own personal results over the years show that the only ITs I have which are notably higher for XIRR include FGT,MRC,IVI and another oddball, 3IN. There are foreign ITs which have done better, but I've ignored those for this purpose.


Arb.

Re: Law Debenture Corp (LWDB)? Any LWDB fans in the house?

Posted: July 2nd, 2020, 11:03 am
by richfool
Well I am happy to be holding MUT of the above mentioned trusts.

Re: Law Debenture Corp (LWDB)? Any LWDB fans in the house?

Posted: August 1st, 2020, 8:28 am
by SalvorHardin
Law Debenture's half-yearly results were published yesterday. As previously stated, the total annual dividend for 2020 will be at least the same as paid in 2019, i.e. 26.0p (four quarterly payments of 6.5p). Yield on the current share price of 528p is 4.92%.

There's quite a bit of commentary in the results, in particular about how Law Debenture differs from other investment trusts (and OEICs) because the managers do not have to chase yield to maintain dividends thanks to the contribution of the Independent Professional Services (IPS) business.

"As a result of the continued robust nature of the IPS revenue, we have not been forced into the value traps that may have ensnared other income investors as they search for yield to maintain their own dividend payments to their investors."

The managers have been doing quite a bit of buying, concentrating on companies which have suspended their dividend payments such as "Anglo American, Marks & Spencer, Linde, Tesco, Boku and Ricardo."

"If there were to be a commonality across the additions to the portfolio it would be that the majority have chosen to temporarily suspend their dividends as a result of Covid-19. This is not a coincidence. It has come about because, in our view, the best total return opportunities in the market currently reside in areas that have been most affected by the virus and have therefore chosen to temporarily suspend payments. When these companies return to paying dividends, and some have already signalled their desire to do so, the prices that we have been purchasing the shares will, we think, result in an attractive dividend yield in the future. The unique structure of Law Debenture with the income provided by the IPS business means that we can confidently purchase these shares that are currently not paying a dividend, while knowing that the Trust as a whole can still pay an attractive dividend yield to shareholders."

https://www.investegate.co.uk/law-debenture-corp/rns/half-year-report/202007310829477481U/

I'm more than happy to hold, I may even make a top-up next week.

Re: Law Debenture Corp (LWDB)? Any LWDB fans in the house?

Posted: August 1st, 2020, 9:53 am
by Dod101
Tesco is not one of those companies that has suspended its dividend as far as I know. I think it may be a value trap.

Dod

Re: Law Debenture Corp (LWDB)? Any LWDB fans in the house?

Posted: August 1st, 2020, 2:39 pm
by monabri
Dod101 wrote:Tesco is not one of those companies that has suspended its dividend as far as I know. I think it may be a value trap.

Dod


Tesco or LWDB?

Re: Law Debenture Corp (LWDB)? Any LWDB fans in the house?

Posted: August 1st, 2020, 2:47 pm
by monabri
The Company’s portfolio will typically contain between 70 and 150 listed investments.

(I counted 133 but I began to go a little cross-eyed so I wouldn't rely on that figure!)

A conviction portfolio it isn't!

Still, they increased the divi significantly and it has a good divi cover according to the AIC at ~2.0.

Re: Law Debenture Corp (LWDB)? Any LWDB fans in the house?

Posted: August 1st, 2020, 5:06 pm
by Dod101
monabri wrote:
Dod101 wrote:Tesco is not one of those companies that has suspended its dividend as far as I know. I think it may be a value trap.

Dod


Tesco or LWDB?


Tesco.