/ SCOTTISH INVESTMENT TRUST /
returns . As contrarian investors , we see three distinct investment categories .
We categorise the first as ugly ducklings – unloved companies that most investors shun . These firms face fundamental challenges , and the market has become extremely pessimistic about their prospects . But we see their out-offavour status as an opportunity .
The second category is where change is afoot . These companies have made significant changes to their prospects , but the improvements are not yet recognised by the market . So , while other managers continue to steer clear , we see the potential for profit .
In the third category are companies that have more to come . Unlike the first two categories , these companies
When ugly ducklings become fully fledged swans , we ’ re looking to sell . Until then , we keep portfolio turnover to a minimum
are generally recognised as good businesses but we see an opportunity as the market does not appreciate the scope for further improvement .
A PAINSTAKING PROCESS To identify the right opportunities , we use a qualitative and quantitative analytic framework to research companies ’ fundamental prospects . We carefully assess any management change and restructuring actions , and consider the likely extent of any earnings recovery .
Companies in our portfolio can move along an axis from “ ugly ducklings ” to “ change is afoot ” and then “ more to come ”. When ugly ducklings become fully fledged swans , we ’ re looking to sell . Until then , we keep portfolio turnover to a minimum .•
For more information visit www . thescottish . co . uk
Please remember that past performance may not be repeated and is not a guide for future performance . The value of shares and the income from them can go down as well as up as a result of market and currency fluctuations . You may not get back the amount you invest . The Scottish Investment Trust PLC has a long-term policy of borrowing money to invest in equities in the expectation that this will improve returns for shareholders . However , should markets fall these borrowings would magnify any losses on these investments . This may mean you get back nothing at all . Investment trusts are listed on the London Stock Exchange and are not authorised or regulated by the Financial Conduct Authority . Please note that SIT Savings Ltd is not authorised to provide advice to individual investors and nothing in this promotion should be considered to be or relied upon as constituting investment advice . If you are unsure about the suitability of an investment , you should contact your financial advisor . This promotion is issued and approved by SIT Savings Ltd , registered in Scotland No : SC91859 , registered office : 6 Albyn Place , Edinburgh , EH2 4NL . Authorised and regulated by the Financial Conduct Authority . Telephone : 0131 225 7781 / Email : info @ thescottish . co . uk / Website : www . thescottish . co . uk
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