Results analysis from Kepler Trust Intelligence

RNS Number : 2791H

Seneca Global Income & Growth PLC

02 December 2020

 

Seneca Global Income & Growth Trust (SIGT)

02/12/2020

Results analysis from Kepler Trust Intelligence

Seneca Global Income & Growth Trust (SIGT) released its interim results this morning, reporting an NAV total return of 10.5% for the six months to 31 October 2020. This was above the CPI +6% annualised benchmark, which returned just 3.6% over the period.

SIGT yielded 4.8% as of the end of the period, and has paid two dividends in line with the previous year. It is anticipated that these levels will be maintained for the full year, with revenue generation being well diversified across asset classes.

Kepler View

The managers of SIGT employ a unique value-influenced decision-making process, across a wide range of assets. Currently, SIGT is comprised of UK and overseas equities, fixed interest, specialists funds and property, with different management approaches applied to each.

The performance of the trust over the six month period was strong relative to the benchmark and we note that it was achieved at a lower annualised volatility than the FTSE All-Share Index. That said the benchmark was adopted in 2017 and the board believes that it can be dangerous to look at short term comparisons, instead favouring measurements over a 'typical investment cycle' which the board believes is at least five years.

A key characteristic of the trust is the value-oriented framework that they employ. The board and managers believe "an inflection point for the growth vs value investment style factors may well have taken place on 9 November with the news of the Pfizer/BioNTech vaccine trial's success". This means looking forward, in their view, it is "possible to imagine a timetable for recovery even if it takes many months and is difficult, whereas before 9 November this was not possible".  SIGT has the potential to take advantage of this and has a demonstratable track record of success in doing so.

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