After I struck a downbeat tone in this column last week, when Blue Monday, ‘Partygate’ and inflation dominated the news, this week has been somewhat more mixed.
There is still negative news aplenty. For example Gary Jackson wrote that 90% of funds lost money over the first few weeks of 2022 in the worst start to a calendar year this century.
Yet, there have also been pockets of positives coming through. As such, I thought I would use this space to highlight the winners and losers of the past week’s news cycle.
It has been a good week for…
Income investors in 2021: Data from Tom Aylott’s article on Monday showed UK dividends bounced back by 46% last year, according to the latest data from the Link Dividend Monitor report.
It means the total paid out last year was above 2016 levels, although still some way off 2019 pre-pandemic highs. Mining payouts grew the most as commodity prices soared, while banks’ and industrials’ dividends were also higher.
It was ‘ore-some’ news for investors, who had been under the cosh in 2020.
Venture Capital Trusts (VCTs): This week Jonathan Jones wrote about the VCT market, which has boomed over the past year. Data from HM Revenue & Customs show that in the tax year 2019/20, VCTs raised £668m from UK private investors, the fourth-highest total raised in a calendar year since their inception in 1995.
Although Mobeus VCTs raised £35m in less than 24 hours last week, with units selling faster than Glastonbury festival tickets (well, nearly), there are many still open to investors including the sought-after Unicorn AIM VCT, which launched this week.
Shareholders in River & Mercantile: The UK asset manager has agreed a deal – subject to shareholder approval – to sell the business to AssetCo for £98.8m.
With the sale of the solutions business to Schroders, investors are in line to be £3.35 per share better off since last summer, R&M’s chair estimated.
TM CRUX European Special Situations and Jupiter Asset Management: After being placed ‘under review’ by interactive investors’ research team, the Crux fund survived the latest rebalance.
Meanwhile, two funds run by Jupiter Asset Management – UK Special Situations and Japan Income – took the place of high-profile names kicked from the list.
It has been a bad week for…
Income investors in 2022: Although underlying dividends are expected to rise this year, the extraordinary volume of one-off special dividends is expected to fall away in 2022, suggesting it will be a leaner year for income-hungry investors.
Funds formerly on interactive investors’ best-buy list: The UK’s second-largest broker made some big changes to its best-buy list, including axing the Liontrust Special Situations and SDL UK Buffettology funds over size concerns.
FTF Martin Currie Japan Equity also got the chop, with the analysts concerned that the best Japan fund of the past decade, but also the most volatile in its sector, was too high-risk for their liking.
Former five FE fundinfo Crown-rated heavyweights: Fundsmith Equity, Blue Whale Growth and a plethora of Baillie Gifford funds all lost their five-crown ratings in the latest rebalance this week.
The start of the year has been a tough one, particularly for growth funds. The sparkling long-term records of some of the UK’s largest portfolios have been dented enough to lose out on the top ranking, taking them from the elite rating to *gasp* the merely ‘very good’.
It has been a mixed week for…
Investors in Morgan Stanley US Growth: The fund lost its five-crown rating, after a disastrous start to 2022 in which it has lost almost 30%.
Despite this, fund pickers told Eve Maddock-Jones that investors should stick with the portfolio as it has outperformed the Nasdaq and the S&P 500 over the past decade.