Exeter Warrant & Global Opportunities unit trust is viewing the current general widening of discount...
Exeter Warrant & Global Opportunities unit trust is viewing the current general widening of discounts as a buying opportunity.
Last month the £6.1m fund, managed by Richard Scott, increased its exposure to Templeton Emerging Markets and Schroder Emerging Countries as both trust's discounts widened beyond the 20% mark.
Scott also increased exposure to more growth oriented trusts after switching out of them between November and January.
Shares in INVESCO Techmark were bought at the beginning of April after which the share price rallied by almost a third.
Scott said: "After running a value oriented portfolio for the first part of the year the prices of growth oriented trusts got so cheap I felt I had to increase my exposure.
"The INVESCO trust looked very attractive compared to Henderson Technology which was trading at a premium."
In the Standard & Poor's global growth peer group the fund is ranked second out of 123, on an offer to bid basis, behind Rathbone Esk unit trust over the three years to 17 May. During the period the Exeter fund rose by 111.9% against an average sector rise of 50%. Scott said: "Part of the reason for the fund's strong performance has been its geographical asset allocation but a significant contribution has come from the active management of the fund's portfolio.
"Not only has switching between value and growth orientated funds helped performance during a volatile period for the markets but the fund has benefited from taking advantage of the changing levels in discounts to net asset values which affect all investment trust shares."
He pointed out that over the past three months the performance of Rathbone Esk has fallen back significantly presumably due to its exposure to technology stocks.
During the three months to 17 May the fund fell by 16.7%on a bid to bid basis. In contrast Scott's fund over three months has continued to outperform the peer group rising by 5.3% compared to an average rise of 2.2% in the sector.
Just under 10% of the fund's portfolio is exposed to investment trust warrants. This weighting in higher risk paper is balanced by a 10% weighting in zero dividend preference shares.
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