/ JANUS HENDERSON /
DISCRETE PERFORMANCE
Performance |
Jun 2016 - Jun 2017 |
Jun 2015 - Jun 2016 |
Jun 2014 - Jun 2015 |
Jun 2013 - Jun 2014 |
Jun 2012 - Jun 2013 |
Nav |
14.50 % |
3.10 % |
6.40 % |
14.80 % |
23.90 % |
Price |
16.60 % |
0.30 % |
7.20 % |
15.10 % |
21.50 % |
Source : © Morningstar 2017 . Annual Return to 30 / 06 / 2017 |
publicly available information there is regarding a firm ’ s finances and its operations . The price is informed by the work of analysts . Big companies tend to be followed by lots of analysts : it averages 24 per firm for those over £ 10bn . Because their operations are so extensively scrutinised it ’ s very unlikely any great corporate initiatives or managerial shakeups will pass under the radar , so the share price tends to reflect the business realities fairly accurately , making it harder for fund managers to find pricing anomalies . In contrast , smaller firms have fewer analysts following them , with those under £ 500m averaging only two . It means there ’ s more opportunity to spot mispricing . Academics call this the ‘ neglected effect ’. to major investments in such an uncertain environment – but as economic confidence has recovered , they ’ ve been spending . According to Dealogic , records were broken in 2015 , with $ 4.7trn of deals . 2016 still proved high at $ 3.8trn .
A RICH HISTORY The Henderson Smaller Companies Investment Trust has not always been in the business of smaller companies . It was founded in 1887 polarising US presidents , oil prices bucking between $ 30 and $ 140 a barrel , Harry Potter and his famous scar , a Middle Eastern melt-down , a searing global financial crisis , and the explosion of social media , smartphones and apps .
Throughout these twists and turns markets have gyrated , yet we have delivered an average annual return of 17.9 %, outperforming the benchmark in 13 of the last 14 years . We know the past doesn ’ t predict
“ Small companies are inherently more nimble , dynamic and innovative , and so are more able to expand ”
3 ) Mergers & acquisitions – One of the big attractions of investing in smaller companies is the likelihood of a corporate action , usually when a larger firm snaps them up . For large , slow-growing companies , taking over an attractive small firm is probably the easiest way to expand the business in a lucrative new direction . M & A deals are viewed as good news for shareholders in the acquired company because as owners of the business they will receive payment , usually in the form of cash or shares in the acquiring company , or a mixture .
Many companies had built up a war-chest of cash in the years following the financial crisis , having been reluctant to commit as the Trustees Executors and Securities Insurance Corporation , aiming to beat UK government bonds . Its original Chairman branched out into accountancy services and eventually formed Touche Ross , now a key part of Deloitte – one of the biggest accountancy firms in the world . It was not until 1992 that it started investing in smaller companies and in 2000 only in those from the UK . This makes it one of the oldest investment trusts there is : surviving , adapting and evolving over many years .
In 2002 , in the wake if the dotcom crash , I became the Trust ’ s fund manager . Much has happened since : four prime ministers , various the future , but this would have transformed £ 1,000 of your cash into over £ 12,000 .
We ’ ve done it through consistency , consistency … you get the idea – the method has never changed . Now supported by Indriatti van Hien , our focus is on finding exceptional management teams and good-quality businesses , buying them at prices we think are value for money ( other small-cap managers care less about firms priced expensively against history or otherwise , but we think this is a key mistake ). With Brexit-this and interest rate-that , the UK market seems on a more cautious footing : now has probably never been a better time for stock picking .•
The information should not be construed as investment advice . Before entering into an investment agreement please consult a professional investment adviser . Past performance is not a guide to future performance . The value of an investment and the income from it can fall as well as rise and you may not get back the amount originally invested . Issued in the UK by Janus Henderson Investors . Janus Henderson Investors is the name under which Henderson Global Investors Limited ( reg . no . 906355 ), Henderson Fund Management Limited
( reg . no . 2607112 ), Henderson Investment Funds Limited ( reg . no . 2678531 ), Henderson Investment Management Limited ( reg . no . 1795354 ), AlphaGen Capital Limited ( reg . no . 962757 ), Henderson Equity Partners Limited ( reg . no . 2606646 ), Gartmore Investment Limited ( reg . no . 1508030 ), ( each incorporated and registered in England and Wales with registered office at 201 Bishopsgate , London EC2M 3AE ) are authorised and regulated by the Financial Conduct Authority to provide investment products and services .
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