Firming up of the regulations on cross-holdings between investment trusts has helped, but it is the current liquid state of the market which really makes a closed end fund of investment trusts such a good product to launch right now says Nick Greenwood, head of investment trusts at Iimia.
Besides the strong gains that can be made by playing differences between net asset values and share prices, the ability of each investment trust to hold a spread of assets means the portfolio of some 25 securities means “risk is diversified away,” Greenwood adds. This is the reasoning behind Iimia’s proposed £30m closed end fund of investment trusts, which will offer retail investors the ability to invest a minimum of £5,000 each before it floats on the market. The new fund was delayed from launch last year because of FSA and industry concerns over new rules limiting cross-holdings be...
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