In focus
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Manager Bruce Stout says investors should turn away from the
UK and towards the developing world if they want a reliable and
growing income
TRUSTNET
Murray International has made
483.66 per cent since Stout took charge
in June 2004, compared with 366 per
cent from the FTSE World ex UK index
and 330.86 per cent from its IT Global
Equity Income sector.
The trust is on a premium of 3.85 per
cent compared with 1.17 and 1.10 from
its one- and three-year averages.
FACT BOX
MANAGER: Bruce Stout / LAUNCHED: 18/12/1907 / DISCOUNT/PREMIUM: +3.85% / OCF: 0.61%
CROWN RATING
PERFORMANCE OF TRUST VS SECTOR AND INDEX
Murray International Trust FTSE World ex UK IT Global Equity
(483.66%) (366.00%) Income (330.86%)
500%
400%
300%
200%
100%
0%
Ju
-100%
would you do that? I can’t get my mind
around it.
“Why would I pay 40 basis points a
year to own Nestlé’s 10-year bond? I
don’t get any income. I don’t even get a
KitKat. So why would I do it?”
The manager accepted the shift in
economic power from west to east
does not mean there are no investment
opportunities in the developed world.
For example, he said companies such
as BHP Billiton, Atlas Copco and Intel
have the business models and market
share to weather any economic shocks
and steadily increase dividends.
“But the deeper pool of opportunities
can be found in Asia and emerging
markets,” he continued.
“Emerging market debt offers
more attractive yields versus gilts,
eurobonds and US treasuries, and
policy makers have far more tools in
the box to fuel growth. Companies
generally have stronger balance
M
urray International has
undergone many changes
since its launch in 1907;
however manager Bruce Stout said
one of the biggest transformations
has taken place over the past 20 years.
Before the turn of the millennium,
the only place that investors could
get a reliable and growing income
was in the UK. However, Stout has
now cut the trust’s exposure to its
home market to its lowest ever levels,
while lifting its exposure to emerging
markets to its highest ever levels.
The manager said this is because the
developing world is now the only
place to find “economic orthodoxy”.
“In this unorthodox world – and
by that I mean in the UK, the US and
Europe, where every yield curve has
been flattened to zero or where some
of them are negative – you’re actually
paying a company for the privilege of
owning a bond,” he explained. “Why
sheets and are benefiting from being
active in countries that are growing
much faster than those in the west.
“Murray International’s strategic
emphasis towards Asia Pacific and
emerging markets may not prove its
full worth over the next 12 months, but
over the next five, 10 or 20 years, these
regions will shine and catch the eye.”
Murray International
Source: FE Analytics
trustnet.com