20+ years of continuous dividend growth
Strong company fundamentals are of central importance in building the portfolio. As part of his fundamental analysis of a company, this experienced fund manager asks a number of questions: Is it a good company? Is the management team on the shareholder’s side? What is the dividend yield and will it grow? Are the shares attractively valued?
Together with a focus on a number key themes – Industrial and support services, UK Domestic value, International opportunities, and Regulated utilities – appropriate use of gearing is used to potentially enhance returns.**
** Gearing: the trust can borrow money in order to buy more assets. This can increase returns but can also magnify losses.
Ciaran describes his investment philosophy and why it’s more about picking the shares that go in the portfolio than about taking big economic views.
* GT Income Growth Trust plc was launched in March 1996 as the successor investment trust to USDC investment trust plc. On 3 July 2000, shareholders approved resolutions to change the investment trust’s name to Invesco Income Growth Trust plc.
|Ordinary Share Price||-3.0||17.3||-1.2||-0.8||-12.2|
|Net Asset Value||3.6||12.9||3.5||-0.6||-12.6|
|FTSE All-Share Index||2.2||18.1||9.0||0.6||-13.0|
Past performance is not a guide to future returns. Ordinary share price performance figures have been calculated using daily closing prices with dividends reinvested. NAV performance figures have been calculated using daily NAV with dividends reinvested. The NAV used includes current period revenue and values debt at fair. The FTSE All-Share Index performance shown is total return. All performance figures are in sterling as at 30 June 2020 unless otherwise stated. Standardised past performance figures are updated on a quarterly basis. Source: Morningstar.
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The Company’s investment objective is to produce income and capital growth superior to that of the UK stock market and dividends paid quarterly that, over time, grow above the rate of inflation.
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The value of investments and any income will fluctuate (this may partly be the result of exchange rate fluctuations) and investors may not get back the full amount invested.
When making an investment in an investment trust you are buying shares in a company that is listed on a stock exchange. The price of the shares will be determined by supply and demand. Consequently, the share price of an investment trust may be higher or lower than the underlying net asset value of the investments in its portfolio and there can be no certainty that there will be liquidity in the shares.
The use of borrowings may increase the volatility of the NAV and may reduce returns when asset values fall.
As a result of COVID-19, markets have seen a noticeable increase in volatility as well as, in some cases, lower liquidity levels; this may continue and may increase these risks in the future. In addition, some companies are suspending, lowering or postponing their dividend payments, which may affect the income received by the product during this period and in the future.