Manager's Comment for January 2015
The ECB formally adopted its version of QE during the month. This drove the Euro even lower and boosted stock markets across Europe. For the first time in a long while, the MSCI World ex US Index outperformed the broader MSCI World Index, reflecting the relative underperformance of US markets against the rest of the world. This is a phenomenon which ought to benefit us, as we have no direct exposure to the US. We continue to find good value opportunities on wide discounts in Europe and the weaker currency, as well as ECB monetary policy, could provide a further boost to these markets. This would likely lead to a narrowing of discounts within our universe and would be beneficial to our strategy.
Two of our closed-end fund holdings were strong contributors to performance over the month, with NB Private Equity Partners (NBPE) and Harbourvest Global Private Equity (HVPE) recording solid gains. Both discounts contracted materially, and the positions were also buoyed by the strong US dollar.
Euro weakness was not enough to hold back our holding in TUI, whose share price climbed +8.8% in sterling terms over the month (+13.1% in Euros) as the market digested the transformative nature of the holding company’s merger with its TUI Travel subsidiary.
Retail Investors advised by IFAs
The Company currently conducts its affairs so that its shares can be recommended by Independent Financial Advisers (“IFAs”) in the UK to ordinary retail investors in accordance with the Financial Conduct Authority (“FCA”) rules in relation to non-mainstream investment products and intends to continue to do so. The shares are excluded from the FCA’s restrictions which apply to non-mainstream investment products because they are shares in an authorised investment trust.
British Empire Securities and General Trust plc
British Empire Securities and General Trust p.l.c. (British Empire) is a closed-end investment trust with shares listed on the London Stock Exchange in the FTSE 250 Index. The investment objective is to achieve capital growth through a focused portfolio of investments, particularly in companies whose share prices stand at a discount to estimated underlying net asset value. British Empire shares can be purchased and held in a Stocks & Shares ISA or a Share Saving scheme through the investment managers, Asset Value Investors.
Asset Value Investors is an employee owned management company founded in 1985 to manage the assets of British Empire, which was a £6 million trust at that time. Today, British Empire has assets of over £856* million and is managed by John Pennink and Joe Bauernfreund.
- Newsletter February 2015
- Newsletter January 2015
- Newsletter December 2014
- Newsletter November 2014
- Half Year Report 2014
- Annual Report 2013
- Brochure Stocks & Shares ISA/Share Plan
- Key Features ISA/Share plan
- AIFMD Investor Disclosure Document
Price Performance December 2003 to December 2013 †
How a typical investment of £7,200 performed over the last five years ‡
British Empire Securities and General Trust has had an average annual NAV total return of 12.2%* since 1985.