Trustnet Magazine Issue 43 September 2018

Issue 43 / September 2018 FE Trustnet magazine When trusts go bust GETTING ONBOARD Do investment trust boards really add value? CUTTING OUT THE MIDDLEMEN How to avoid platform fees TRADE-OFF Do Asia’s growth prospects outweigh the risks? Fund, Pension, Trust / Sector Profile / Stockpicker / What I Bought Last ISSUE 43 CREDITS FE TRUSTNET MAGAZINE (FORMERLY INVESTAZINE) IS PUBLISHED BY THE TEAM BEHIND FE TRUSTNET IN SOHO, LONDON WEBSITE: www.trustnet.com EMAIL: editorial@financialex- press.net Editor’s letter T he structure of investment trusts gives them many advantages over funds, but their status as limited companies means they can go out of business. In this month’s cover story, Adam Lewis finds out how often this has happened in the past five years and reveals what to expect if the board decides to pull the plug. This independent board of directors is often cited as one of the biggest advantages of investment trusts, but how much value do they really add? This is the question Cherry Reynard asks 34 A clean bill of health? Cutting out the middlemen says the market often places a premium valuation on businesses with a lower number of shares in issue P. 23-27 Javier Otero Art direction & design W: www.feedingcrows.co.uk Photos supplied by iStock Cover illustration: Javier Otero which fund he is using while noise is trumping fundamentals in emerging markets. Enjoy reading, Big biotech recovered quickly from the threat of price caps, but Rebecca Jones says it faces a larger threat from within Anthony Luzio Editor T: 0207 534 7652 Sales Richard Fletcher Head of publishing sales T: 0207 534 7662 Richard Casemore Account manager T: 0207 534 7669 John Blowers weighs up the pros and cons of investing directly with an asset manager, and CFP Sanford DeLand’s Rosemary Banyard names three stocks given a premium valuation thanks to their small number of shares in issue. Finally, Liontrust’s John Husselbee reveals Anthony Luzio Editor Contents CONTACTS: Editorial Gary Jackson Editor (FE Trustnet) T: 0207 534 7680 Jonathan Jones Senior reporter T: 0207 534 7640 Mai Sardon Reporter T: 0207 534 7625 Henry Scroggs Reporter T: 0207 534 7692 on page 13. Meanwhile, Rebecca Jones casts her eye over biotech, one of the best performing closed-ended sectors over the past decade, to see if it can keep up the good work. In our regular columns, I find out whether “trade wars” will affect Asia’s long- term growth story, Fund, pension, trust The end of the road Adam Lewis finds out what happens when investment trusts go out of business Getting onboard P. 2-7 Cherry Reynard asks: how much value does an independent board of directors really add? UK market ripe for stock pickers Income facts Baillie Gifford’s Milena Mileva says the UK contains some “tremendously exciting businesses” that are world leaders in their field P. 8-11 P. 13-16 David Smith of the Henderson High Income Trust explains why dividends should be an important consideration for every type of investor P. 18-21 AXA Framlington Global Technology, Marlborough UK Micro Cap Growth and Independent Investment Trust find themselves under the spotlight this month John Blowers weighs up the pros and cons of bypassing platforms and advisers and investing directly with an asset manager P. 42-47 Scarce story CFP Sanford DeLand Free Spirit’s Rosemary Banyard P. 48-49 What I bought last Liontrust’s John Husselbee names a fund he says represents a useful addition to his portfolios while noise is trumping fundamentals in emerging markets P. 50-51 P. 28-33 Trade-off The recent spike in volatility is the price investors must pay to access Asia’s powerful long-term growth themes, writes Anthony Luzio P. 34-39 Data hub Crunching the biggest trends down into figures P. 40-41 42

Trustnet Magazine Issue 43 September 2018 | Page 2