Alliance Trust (ATST)

[BullDog]

Over the last four decades, I have in the past held F&C, Witan and Alliance Trust. For a significant period now though, I have been watching from the sidelines. There's nothing really wrong with holding any of them. I just ask myself though, "why would anyone really want to hold them?". Other than a combination of habit and history, I find it hard to think of a single good reason why anyone would buy these investment trusts any more. Their continued existence means someone buys them. Obviously.

[Dod101]

Over the last four decades, I have in the past held F&C, Witan and Alliance Trust. For a significant period now though, I have been watching from the sidelines. There's nothing really wrong with holding any of them. I just ask myself though, "why would anyone really want to hold them?". Other than a combination of habit and history, I find it hard to think of a single good reason why anyone would buy these investment trusts any more. Their continued existence means someone buys them. Obviously.

I have held all three at different times over the last 30 years or so. I now hold only Alliance. It is in my DNA, having been born, like Alliance, in Dundee. I am not as old though. My reason for holding it is simple. It is a good and reliable base for whatever else I hold. It ticks along and I was reading the other day that it is only about 20% or so behind the NASDAQ over the last several years. It is certainly better than some ITs that I have held, not as good as others but so what? Not all shares do best at all times. We need diversity so that some will do well some of the time, others will do well at other times. Alliance is far from a dog.

Dod

[Lootman]

Over the last four decades, I have in the past held F&C, Witan and Alliance Trust. For a significant period now though, I have been watching from the sidelines. There's nothing really wrong with holding any of them. I just ask myself though, "why would anyone really want to hold them?". Other than a combination of habit and history, I find it hard to think of a single good reason why anyone would buy these investment trusts any more. Their continued existence means someone buys them. Obviously.

These types of trusts have been declining since the 1980s. First the institutions started building their own in-house investment teams and so had less need of an external manager to do that for them. Then the retail investor started deserting them for index funds and ETFs.

So go back 30 years and there were quite a few more of these venerable funds that have since disappeared. There was Globe IT, once the daddy of them all and a FTSE-100 constituent. Others that have gone were TR Industrial & General and Scottish Eastern. Whilst others have changed their spots - Scottish Mortgage used to a boring global generalist and now it is an out-and-out risk-taking tech fund.

The other two I recall were Scottish Investment Trust and Scottish American Trust, which have both changed, merged or been rebbranded.

[BullDog]

Over the last four decades, I have in the past held F&C, Witan and Alliance Trust. For a significant period now though, I have been watching from the sidelines. There's nothing really wrong with holding any of them. I just ask myself though, "why would anyone really want to hold them?". Other than a combination of habit and history, I find it hard to think of a single good reason why anyone would buy these investment trusts any more. Their continued existence means someone buys them. Obviously.

These types of trusts have been declining since the 1980s. First the institutions started building their own in-house investment teams and so had less need of an external manager to do that for them. Then the retail investor started deserting them for index funds and ETFs.

So go back 30 years and there were quite a few more of these venerable funds that have since disappeared. There was Globe IT, once the daddy of them all and a FTSE-100 constituent. Others that have gone were TR Industrial & General and Scottish Eastern. Whilst others have changed their spots - Scottish Mortgage used to a boring global generalist and now it is an out-and-out risk-taking tech fund.

The other two I recall were Scottish Investment Trust and Scottish American Trust, which have both changed, merged or been rebbranded.

Exactly. Good potted history. I started investing in ITs in the late 1970's and died** of boredom by the mid to late 80's holding those venerable dinosaur survivors. Nope, I still can't think of a good reason to buy one of them today.

** Not really.......

Ah, Globe IT. Was bought by the miners pension fund if I recall correctly. It's demise resulted in F&C becoming the largest investment trust in Globe's place.

[Dod101]

The largest Investment trust currently is Scottish Mortgage I think. Over the years, it has knocked all competition into a cocked hat.

For Lootman, Scottish Investment Trust is currently being liquidated and its assets taken over by JPM Global and Growth trust. Scottish American continues and is managed by Baillie Gifford.

ITs were 'invented' in Scotland by Robert Fleming and show no signs of dying as yet. And, Bulldog, boring is good in investing.

Dod

[monabri]

Nope, I still can't think of a good reason to buy one of them today.

It seems that everytime I compare the total returns of "growth" ITs with VRWL/VWRP (or similar), I'm left wondering "what am I paying for?".

ETFs to grow, income ITs for dough and a HYP for the occasional kicking below!

[Dod101]

Over the last four decades, I have in the past held F&C, Witan and Alliance Trust. For a significant period now though, I have been watching from the sidelines. There's nothing really wrong with holding any of them. I just ask myself though, "why would anyone really want to hold them?". Other than a combination of habit and history, I find it hard to think of a single good reason why anyone would buy these investment trusts any more. Their continued existence means someone buys them. Obviously.

These types of trusts have been declining since the 1980s. First the institutions started building their own in-house investment teams and so had less need of an external manager to do that for them. Then the retail investor started deserting them for index funds and ETFs.

So go back 30 years and there were quite a few more of these venerable funds that have since disappeared. There was Globe IT, once the daddy of them all and a FTSE-100 constituent. Others that have gone were TR Industrial & General and Scottish Eastern. Whilst others have changed their spots - Scottish Mortgage used to a boring global generalist and now it is an out-and-out risk-taking tech fund.

The other two I recall were Scottish Investment Trust and Scottish American Trust, which have both changed, merged or been rebbranded.

Exactly. Good potted history. I started investing in ITs in the late 1970's and died** of boredom by the mid to late 80's holding those venerable dinosaur survivors. Nope, I still can't think of a good reason to buy one of them today.

** Not really.......

Ah, Globe IT. Was bought by the miners pension fund if I recall correctly. It's demise resulted in F&C becoming the largest investment trust in Globe's place.

If you are referring to investment trusts in general, then I have been much too generous in my comments so far. Generalist ITs such as those you and Lootman have mentioned seem to me to be a good backbone for almost any investment portfolio but there are so many specialist trusts around that they cannot simply be dismissed. There are wealth preservers, those that specialise in say windfarms, actively managed ones like Caledonia (which tomorrow is giving us shareholders a very attractive special dividend) RIT Capital Partners which invests in areas that we could not reach ourselves as individual investors, some which provide a good and reliable dividend, others that are mainly growth oriented and so on. If you do not invest in them, I would suggest that it is your loss. You 'died' of boredom? What could be more boring than buying an index fund? LIke all investments, companies come and companies go. An investment trust is just a joint stock company after all. They were a great British invention and we are still reaping the benefits today (at least most of us are)

Dod

[Lootman]

Over the last four decades, I have in the past held F&C, Witan and Alliance Trust. For a significant period now though, I have been watching from the sidelines. There's nothing really wrong with holding any of them. I just ask myself though, "why would anyone really want to hold them?". Other than a combination of habit and history, I find it hard to think of a single good reason why anyone would buy these investment trusts any more. Their continued existence means someone buys them. Obviously.

These types of trusts have been declining since the 1980s. First the institutions started building their own in-house investment teams and so had less need of an external manager to do that for them. Then the retail investor started deserting them for index funds and ETFs.

So go back 30 years and there were quite a few more of these venerable funds that have since disappeared. There was Globe IT, once the daddy of them all and a FTSE-100 constituent. Others that have gone were TR Industrial & General and Scottish Eastern. Whilst others have changed their spots - Scottish Mortgage used to a boring global generalist and now it is an out-and-out risk-taking tech fund.

The other two I recall were Scottish Investment Trust and Scottish American Trust, which have both changed, merged or been rebbranded.

Exactly. Good potted history. I started investing in ITs in the late 1970's and died** of boredom by the mid to late 80's holding those venerable dinosaur survivors. Nope, I still can't think of a good reason to buy one of them today.

** Not really.......

Ah, Globe IT. Was bought by the miners pension fund if I recall correctly. It's demise resulted in F&C becoming the largest investment trust in Globe's place.

If you are referring to investment trusts in general, then I have been much too generous in my comments so far. Generalist ITs such as those you and Lootman have mentioned seem to me to be a good backbone for almost any investment portfolio but there are so many specialist trusts around that they cannot simply be dismissed. There are wealth preservers, those that specialise in say windfarms, actively managed ones like Caledonia (which tomorrow is giving us shareholders a very attractive special dividend) RIT Capital Partners which invests in areas that we could not reach ourselves as individual investors, some which provide a good and reliable dividend, others that are mainly growth oriented and so on. If you do not invest in them, I would suggest that it is your loss. You 'died' of boredom? What could be more boring than buying an index fund? LIke all investments, companies come and companies go. An investment trust is just a joint stock company after all. They were a great British invention and we are still reaping the benefits today (at least most of us are)

Dod, i am heavily invested in ITs including some of those you cited. They definitely have their place.

I think the discussion here is the utility of the old-school generalist global ITs which, I would submit, has declined considerably over the last 40 years.

[Dod101]

Over the last four decades, I have in the past held F&C, Witan and Alliance Trust. For a significant period now though, I have been watching from the sidelines. There's nothing really wrong with holding any of them. I just ask myself though, "why would anyone really want to hold them?". Other than a combination of habit and history, I find it hard to think of a single good reason why anyone would buy these investment trusts any more. Their continued existence means someone buys them. Obviously.

These types of trusts have been declining since the 1980s. First the institutions started building their own in-house investment teams and so had less need of an external manager to do that for them. Then the retail investor started deserting them for index funds and ETFs.

So go back 30 years and there were quite a few more of these venerable funds that have since disappeared. There was Globe IT, once the daddy of them all and a FTSE-100 constituent. Others that have gone were TR Industrial & General and Scottish Eastern. Whilst others have changed their spots - Scottish Mortgage used to a boring global generalist and now it is an out-and-out risk-taking tech fund.

The other two I recall were Scottish Investment Trust and Scottish American Trust, which have both changed, merged or been rebbranded.

Exactly. Good potted history. I started investing in ITs in the late 1970's and died** of boredom by the mid to late 80's holding those venerable dinosaur survivors. Nope, I still can't think of a good reason to buy one of them today.

** Not really.......

Ah, Globe IT. Was bought by the miners pension fund if I recall correctly. It's demise resulted in F&C becoming the largest investment trust in Globe's place.

If you are referring to investment trusts in general, then I have been much too generous in my comments so far. Generalist ITs such as those you and Lootman have mentioned seem to me to be a good backbone for almost any investment portfolio but there are so many specialist trusts around that they cannot simply be dismissed. There are wealth preservers, those that specialise in say windfarms, actively managed ones like Caledonia (which tomorrow is giving us shareholders a very attractive special dividend) RIT Capital Partners which invests in areas that we could not reach ourselves as individual investors, some which provide a good and reliable dividend, others that are mainly growth oriented and so on. If you do not invest in them, I would suggest that it is your loss. You 'died' of boredom? What could be more boring than buying an index fund? LIke all investments, companies come and companies go. An investment trust is just a joint stock company after all. They were a great British invention and we are still reaping the benefits today (at least most of us are)

Dod, i am heavily invested in ITs including some of those you cited. They definitely have their place.

I think the discussion here is the utility of the old-school generalist global ITs which, I would submit, has declined considerably over the last 40 years.

Thanks. Yes I agree about the long established generalists although I do think that they have their place. Quite probably their importance and certainly their utility has declined over the last half century or so, given the rise of the index funds.

Dod

[richfool]

Alliance Trust PLC - Interim Results

Alliance Trust PLC (“the Company”)
LEI: 213800SZZD4E2IOZ9W55
28 July 2023

Strong performance in a volatile market

Results for six months ended 30 June 2023

Six months to 30 June 2023 Year to 31 December 2022 Change
Share Price 1,008.0p 948.0p 6.3%
Net Asset Value (‘NAV’) per Share1 1,086.5p 989.5p 9.8%
NAV Total Return2 11.1% -7.1%
Total Shareholder Return (‘TSR’)2 7.6% -5.8%

MSCI ACWI Total Return 7.8% -8.1%

Discount to NAV -7.2% -4.2%

Key Points

For the six months ended 30 June 2023, the Company’s NAV Total Return2 was 11.1%, significantly outperforming its benchmark index, the MSCI All Country World Index (‘MSCI ACWI’) which returned 7.8%.
Total Shareholder Return2 (‘TSR’) was 7.6%, due to a widening of the discount, which compared favourably with peers3 (-7.2% as of 30 June 2023 vs -11.1% for the AIC Global Sector average).
Second interim dividend of 6.34p per share declared, up from 6.18p for the first interim dividend. Increased dividend level is expected to be at least maintained for the third and fourth interim dividends, giving an expected annual dividend increase of 5% year-on-year.
After completing a tenure of nine years, Gregor Stewart will step down from the Board and his role as Chairman at the year-end and will be succeeded by Dean Buckley, who joined the Board in March 2021.

Gregor Stewart, Chairman of Alliance Trust PLC, commented:

“I am pleased to report that the Company significantly outperformed the market and most of its peers in the first half of 2023, despite volatile market conditions. This demonstrates the benefit of our diversified, high conviction approach. Although the economic outlook remains highly uncertain, the Board believes the strategy is well designed to navigate different market environments and continue delivering attractive capital growth and a rising dividend.

https://www.investegate.co.uk/announcem ... ts/7660442


Alliance Trust PLC - Dividend Declaration

Alliance Trust PLC (‘the Company’)
LEI: 213800SZZD4E2IOZ9W55

Dividend Declaration

Alliance Trust PLC announces the declaration of a second interim dividend of 6.34p per share, up from 6.18p for the first interim dividend. This follows the 26% increase in dividends for 2022 compared to 2021.

The dividend will be paid on 29 September 2023 to shareholders on the register at the close of business on 1 September 2023. The ex-dividend date is 31 August 2023.

Barring unforeseen circumstances, the increased level of the second interim dividend is expected to be at least maintained for the third and fourth interim dividends. This is therefore expected to result in a total dividend for 2023 of at least 25.20p, an increase of 5% on the Company’s 2022 dividend. Based on the Company’s share price on 30 June 2023, this level of total dividend would result in an annual dividend yield of 2.5%.

https://www.investegate.co.uk/announcem ... on/7660706

[Avantegarde]

The AIC website says dividends at the Alliance trust have been rising at the cracking annual rate of 12% for the past five years. How come, considering it invests in many of the really big international companies favoured by many other big international trusts, whose dividends have not risen nearly so fast?

[BullDog]

The AIC website says dividends at the Alliance trust have been rising at the cracking annual rate of 12% for the past five years. How come, considering it invests in many of the really big international companies favoured by many other big international trusts, whose dividends have not risen nearly so fast?

There's quite a few ways they can do this. Most obviously, paying some of the dividend from capital. Alliance Trust will have reserves it can draw on too should it need to in order to maintain it's dividend or maintain it's dividend growth record. There's a number of other ways too but I think those are the most likely.

[Dod101]

Alliance changed some capital reserves to distributable ones as few years back, enabling them to pay some dividends from reserves if necessary. I think though that the dividends have been covered by revenue for most of the time though. They did though deliberated up their payout.
Dod

[Avantegarde]

To answer my own question, the trust announced very big increases in dividends in 2021 and 2022. This has ramped up the annual rate of increase recorded for the past five years. The trust says such big increases may not be repeated this year.

[richfool]

2.3% possibly becoming 2.5% isn't bad for a global growth IT., compared to its peers.

[richfool]

Alliance Trust PLC - Dividend Declaration

Alliance Trust PLC
LEI: 213800SZZD4E2IOZ9W55

Dividend Declaration

Alliance Trust PLC announces the declaration of a third interim dividend of 6.34p per share, representing an increase of 5.7% on the equivalent dividend of 6.00p paid in respect of the previous financial year.

The dividend will be paid on 29 December 2023 to shareholders on the register at the close of business on 1 December 2023. The ex-dividend date is 30 November 2023.

Barring unforeseen circumstances, this increased level of dividend is expected to be at least maintained for the fourth interim dividend. This is therefore expected to result in a total dividend of 2023 of at least 25.20p, an increase of 5% on the Company’s 2022 dividend. This follows the 26% increase in dividends for 2022 compared to 2021.

https://www.investegate.co.uk/announcem ... on/7841895

One of my global growth IT holdings, along with Brunner (BUT).

[Hariseldon58]

Interesting discussions, a quick comparison of total returns for Alliance Trust with VWRL showed the winner over 3 months, 6 months, 1 , 3 & 5 years is Alliance Trust. It may well be different next week, might well have been different last week...

I hold significant sums in various World Index funds, I am always a little nervous when "everyone " knows that alternative investment styles are doomed and only World Index funds are the prudent choice.

I have added a very diverse collection of other investments, broadly speaking on an equally weighted basis, a mixture of investment trusts and index funds that are not Global Market Cap trackers.

I still have a 60+% holding in Global market Cap trackers but reducing my dependency on a single approach with a heavy bias to US large cap stocks seems prudent.

[OhNoNotimAgain]

the new Alliance practice seems to be gaining ground and a number of perfectly respectable trusts use capital to fund a dividend. My slight concern is this will erode their capital gains in the longer run.

Yes, it is a fashion now, because UK investors crave and demand running yield. A short-sighted view in my opinion. Scottish Mortgage took the road less travelled.

There is a second problem with doing this. It creates an immediate and unavoidable tax event. Whereas allowing those funds instead to remain within the fund's share capital allows me the option of choosing when or whether to incur that tax event.

How unreasonable for investors to want to get some cash back from their investments.

Don't they know the purpose of managed funds is to make the manager rich, give him or her a platform to smugly pontificate about the stuff they know FA about and give investors bragging rights about clever they have been to buy it.

[Lootman]

Yes, it is a fashion now, because UK investors crave and demand running yield. A short-sighted view in my opinion. Scottish Mortgage took the road less travelled.

There is a second problem with doing this. It creates an immediate and unavoidable tax event. Whereas allowing those funds instead to remain within the fund's share capital allows me the option of choosing when or whether to incur that tax event.

How unreasonable for investors to want to get some cash back from their investments.

Don't they know the purpose of managed funds is to make the manager rich, give him or her a platform to smugly pontificate about the stuff they know FA about and give investors bragging rights about clever they have been to buy it.

Don't be crass, the best performing funds are usually growth funds because they grow! Most investors want total return from securities that grow, not
de facto bonds or annuities.

[Dod101]

Interesting discussions, a quick comparison of total returns for Alliance Trust with VWRL showed the winner over 3 months, 6 months, 1 , 3 & 5 years is Alliance Trust. It may well be different next week, might well have been different last week...

I hold significant sums in various World Index funds, I am always a little nervous when "everyone " knows that alternative investment styles are doomed and only World Index funds are the prudent choice.

I have added a very diverse collection of other investments, broadly speaking on an equally weighted basis, a mixture of investment trusts and index funds that are not Global Market Cap trackers.

I still have a 60+% holding in Global market Cap trackers but reducing my dependency on a single approach with a heavy bias to US large cap stocks seems prudent.

Bear in mind though that Alliance pays at least part of its dividend via a distribution from their reserves. Not so long ago, they converted their merger reserves into distributable reserves and upped their dividend, funded in part from these reserves. It seems to be an increasing trend.

Dod