End of week note for investment trust investors

It was a quiet week generally in the financial markets, albeit a massive one in terms of meteorological and astronomical conditions. “Nations, like stars, are entitled to eclipse. All is well, provided the light returns and the eclipse does not become endless night.” (Les Misérables, 1862, Victor Hugo). President Donald J Trump will not want to see “endless night” post his escapades in the SoH. Equities were mixed as the Iran conflict remained a key source of concern with a lasting resolution seemingly quite far off at this point. Tehran has apparently resisted direct negotiations with the US over a reopening of the SoH until several conditions are met including full compensation for the conflict. Trump has said that Iran must agree to compensate for the past deaths of American soldiers and Iranian civilians in order to reach a deal also. The oil price drifted slightly higher also to around $88 per barrel. In the US, inflation in the year to July rose 3.4%, slightly lower than the 3.5% seen in June and that impacted on demand for the latest 30-year US Treasury auction. In addition, reports have been circulating again of an Anthropic IPO likely coming this Autumn, with a target valuation of $2 trillion.

In the UK, Andy Burnham has been quiet as he adjusts to being a PM rather than a mayor. UK consumer confidence hit its highest level in almost two years in July driven largely by a truce (of sorts) in the Middle East and the World Cup. The UK economy grew by 0.4% in the quarter to end June 2026 according to the ONS, also benefitting from the one-off boost provided by the World Cup, with growth expected to moderate in the coming months. It is pleasing to see the LSE call for more transparency for pensioners from pension fund providers this week such that they can determine how much of it is actually invested in the UK. Dame Hoggett has finally been more vocal about the link between tax incentives and domestic investment also.

In the investment trust sector, average discounts (ex 3i Group) were relatively steady ending at 10.8%, with almost no change from last week. Again, we saw a number of mid-year reports come out and we noted Frostrow client, CQS Natural Resources Growth & Income, seeking to change the name of the fund with the managers set to arrive at Tufton Investment Management next month.

The Ruffer monthly report made an insightful statement this week, which I repeat here: “financial markets have a marvellous way of turning a good idea into a bad investment by funnelling too much capital towards it.” This statement was made in reference to AI of course, but it could equally be made to other situations like the ETF market, having grown just under 4x from their already inflated asset levels in 2020 alone due to COVID and technological advances making investment more commoditised. Active open-ended funds and investment trusts have seen no such growth. I would continue to humbly suggest that you do not want to be short of investment trusts.

Forthcoming Frostrow events to note round the corner include:

Aurora UK Alpha annual investor event: to be held from 4pm on Wednesday 14 October 2026 at Chartered Accountants’ Hall, One Moorgate Place, London EC2R 6EA

2. Frostrow Investor Events

Aurora UK Alpha (ARR LN, UK All Companies, £273.3m mkt capn, 12.0% discount to NAV): the Phoenix investment team are available for meetings with investors in 2026. The latest update from the management team, from 26 January 2026, is available to view here:

https://www.youtube.com/watch?v=8BbZc9dgjB0

Biotech Growth Trust (BIOG LN, Healthcare & Biotechnology, £328.1m mkt cap, 5.1% discount to NAV): Co-portfolio manager, Josh Golomb, provided an update for investors via Investor Meet Company on 10 March 2026: https://www.investormeetcompany.com/meetings/investor-presentation-1001

A link to the presentation by Geoff Hsu at the AGM on 16 July 2026 can be found here: https://www.youtube.com/watch?v=izwHIML8spU

Kepler video: The Biotech Growth Trust: why now for global biotech innovation?

CC Japan Income & Growth Trust (CCJI LN, Japan, £381.3m mkt capn, 6.3% discount to NAV): please contact Frostrow Capital in order to arrange a meeting with management in 2026. In addition, we note CCJI QuotedData In the Hot Seat interview to view here:

https://www.youtube.com/live/eBmf8nisElM?si=O11Cr1IHSuQbv2A0

An Investor Meet Company webinar took place on 18 March 2026. Do view it here:

https://www.investormeetcompany.com/meetings/investor-presentation-1002

CQS Natural Resources Growth & Income (CYN LN, Commodities & Natural Resources, £152.2m mkt capn, 1.3% premium to NAV): investor meetings available again post 14 September 2026

Custodian Property Income REIT (CREI LN, Property UK Commercial, £380.4m mkt capn, 19.1% discount to NAV): Richard Shepherd-Cross, lead manager, is available for meetings in 2026 (physical throughout UK, or zoom, as per preference). Richard also gives his most updated thoughts in the Investor Meet Company webinar which took place on 13 February 2026. You can view it here:

https://www.investormeetcompany.com/meetings/investor-presentation-997

Ecofin Global Utilities & Infrastructure (EGL LN, Infrastructure Securities, £249.1m mkt capn, 1.1% premium to NAV) : Jean-Hugues de laMaze, lead manager of the Trust conducted an Investor Meet Company webinar on 27 May 2026, and for those who missed it, you can access it here:

https://www.investormeetcompany.com/meetings/investor-presentation-1038

Finsbury Growth & Income Trust (FGT LN, UK Equity Income, £807.1m mkt capn, 6.7% discount to NAV): Frostrow highlight Nick Train’s presentation at the Company’s AGM on 15 January 2026, available to view here:

https://www.youtube.com/watch?v=2zZXsxaL9xQ

In addition, we highlight FGT Quoted Data In the Hot Seat interview here from 6 March 2026:

https://quoteddata.com/events/in-the-hotseat-nick-train-finsbury-growth-income/

Link to follow in due course for the webinar of 15 July 2026:

https://www.youtube.com/watch?v=jE9n4ut7xl0

MIGO Opportunities Trust (MIGO LN, Flexible Investment, £69.9m mkt capn, 4.4% discount to NAV): To watch the most recent update which took place on 24 March 2026 with Tom Treanor and Charlotte Cuthbertson, click here:

https://www.investormeetcompany.com/meetings/investor-presentation-995

To watch the latest MIGO webinar post FY results and 30 June 2026 factsheet update, please view the event recorded on 27 July 2026 here - MIGO OPPORTUNITIES TRUST PLC - Annual Results

Temple Bar Investment Trust (TMPL LN, UK Equity Income, £1,302.8m mkt capn, 0.8% premium to NAV): Read the latest quarterly Temple Bar IT newsletter here if your Bar is set high and your portfolio is your Temple: https://www.templebarinvestments.co.uk/media/insights/century-value-investing/

An Investor Meet Company webinar took place on 11 March 2026 and is available to view on this link:

https://www.investormeetcompany.com/meetings/investor-presentation-1008

See co-portfolio manager, Nick Purves’ interview on Citywire from July 2026 here: https://lnkd.in/ezCQ6qZN

Worldwide Healthcare Trust (WWH LN, Healthcare & Biotechnology, £1,389.9m mkt capn, 6.3% discount to NAV): Trevor Polischuk’s comments at the Winterflood’s Annual conference were recorded here (January 2026):

Trevor Polischuk, Worldwide Healthcare Trust - Innovation in Healthcare | Winterflood Conference 2026

See below the link to the latest WWH AGM presentation recording from 14 July 2026:

https://www.youtube.com/watch?v=-phskZBx8gE

Frostrow Investor Relations team – Messrs Grant Challis, Neil Winward, Matt Burrows, Nicholas Todd & Max Smith

Please contact us on ir@frostrow.com

Trump is doing his best to re-set the world geopolitical and trade order and in so doing will potentially re-set the investment landscape. Saba Capital have said they are “ready to buy billions more UK investment trusts [and they are] open to taking stakes in trusts that hold illiquid assets [now also]”. The UK Government have finally seen sense to allow their pension funds to invest in investment trusts to access a variety of assets such as infrastructure and private equity. Record ETF issuance continues, with now more active ETFs than passive and record open ended funds converting into ETFs also. Whether there is a “crack” in the bond market or not, the investment trust sector is here offering best in class active management from the world’s top fund managers in a variety of liquid and less liquid asset classes. It continues to represent one third of the FTSE 250 Index and half of the FTSE Small Cap Index. There are highly valuable actively managed listed fund vehicles using the structure appropriately available for savings and investment today, as there have been for the last 150 + years – despite Elon Musk’s views. They act as a strong complement to passive ETF holdings also.

DO NOT BE SHORT OF INVESTMENT TRUSTS

Find us on the web: https://www.frostrow.com/

Find us on You Tube: https://www.youtube.com/channel/UCAptpfmx0HITqvlI68psd7Q

Check out our May 2026 summary podcast here: https://www.investormeetcompany.com/updates/frostrow-talks-trusts-may-2026-podcast/show

Frostrow Capital, bringing you high quality, differentiated product in a UK listed closed-ended form

3. Further investment themes evident in the investment trust sector this week include:

Discount / Premium control

A total of 377 corporate announcements from Monday this week on the LSE, of which 146 were in reference to share buybacks (38.7% of total). 6 referred to equity issuance.

Vietnam Enterprise Investments Limited (VEIL LN, Country Specialist, £897.1m mkt capn, 11.3% discount to NAV): the Company repurchased 13.7m shares (8.5% of share capital) at an average discount to NAV of 10.9% in July 2026

Tender / Redemption offer update

Aberdeen Asia Focus (AAS LN, Asia Pacific Smaller Companies,£614.9m mkt capn, 9.7% discount to NAV): Over the five-year measurement period from 1 August 2021 to 31 July 2026, the Company's NAV total return per share (Basic) was 67.2%, compared to the Index total return of 37.8% and as such no tender offer will take place on this occasion. The Board intends to renew the performance-linked conditional tender mechanism for a further five-year assessment period on materially the same terms. Under the renewed mechanism, if the Company's NAV total return fails to equal or exceed the total return of the MSCI AC Asia ex Japan Small Cap Index (in £ terms) over the new assessment period, the Board would put forward proposals to enable shareholders to realise a proportion of their holdings for cash at a level close to NAV, less the costs of the tender offer, capped at 25% of issued share capital. In order to mitigate for the potential effect of volatility at the final calculation date, performance over the measurement period will be measured using the Company's average of the five-year NAV total return over each of the trading days in the final month of the period, being July 2031, against the average total return of the benchmark over the same period.

Saba Capital and activist update

Schroder UK Mid Cap Fund (SCP LN, UK All Companies, £165.7m mkt capn, 5.9% discount to NAV): Saba Capital holding decreased from 19.1% to 0%

M&A update

Pacific Assets Trust (PAC LN, Asia Pacific, £486.9m mkt capn, 6.3% discount to NAV): the Company published a circular in respect of the proposed scheme of reconstruction (to transfer part of the Company's cash, assets and undertaking to Schroder Asian Total Return Investment Company) and members' voluntary winding up of the Company. The proposals require the approval of shareholders at a first and second general meeting on 9th and 24th September 2026. The cash option is limited to 25% of share capital at NAV less 2%. The default option is for new ATR shares to be issued to shareholders. (Frostrow client)

Schroder Asian Total Return Investment Company (ATR LN, Asia Pacific, £657.1m mkt capn, 3.3% discount to NAV): the Company published a circular in respect of the proposed scheme of reconstruction (to transfer part of Pacific Assets Trust's cash, assets and undertaking to Schroder Asian Total Return Investment Company). The proposals require the approval of shareholders at a general meeting on 8th September 2026. The cash option is limited to 25% of share capital at NAV less 2%. The default option is for new ATR shares to be issued to shareholders. The proposed combination will lead to increased scale and liquidity, investors will benefit from a revised management fee structure and lower ongoing charges and the enlarged company will put forward a performance-related tender offer for up to 15% of issued share capital to shareholders if, over the five-year period from 31 December 2025 to 31 December 2030, the Company's NAV total return does not exceed the total return of the Reference Index.

Results / updates

HgCapital Trust update for HY to 30 June 2026 (HGT LN, Private Equity, £1,848.2m mkt capn, 23.0% discount to NAV): NAV TR -4.9%; share price TR -24.9%; weighted portfolio average valuation multiple of 22.9x (25.2x December 2025); net debt to EBITDA ratio of 6.9x (7.4x December 2025); £254m of available liquid resources (including a £375m credit facility of which £134m is drawn). £146m invested in the period with £134m of realisations. "HgT is in advanced discussions to upsize and extend the current credit facility which is due to expire in March 2027. Conversations with lending banks have been constructive and we will provide a further update in due course"

Alternative Income quarter end 30 June 2026 update (AIRE LN, Property – UK Commercial, £57.8m mkt capn, 13.1% discount to NAV): NAV TR +0.4%; quarterly dividend of 1.4pps paid; "The portfolio continues to demonstrate resilience, remaining 100% let, with 100% rent collection and 81.9% of leases subject to index-linked rent reviews." "Following the period end, on 16 July 2026 AEWU announced a revised possible all-share offer valuing AIRE at approximately 77.5 pps...The Board welcomed the proposal and stated that it had the potential to provide a more attractive outcome for shareholders than the Glenstone Offer, whilst noting that there could be no certainty that a firm offer will be made. On 20 July 2026, the Board formally recommended that shareholders reject the Glenstone Offer, believing that it materially undervalued the Company...Notwithstanding these approaches, the Board remains confident in AIRE's prospects as a standalone company. Following the successful refinancing of the Company's debt facilities with HSBC UK Bank plc, the Board believes the Company is well positioned to continue generating secure and predictable income returns while preserving capital values, through investment in UK alternative and specialist sector real estate."

Foresight Environmental Infrastructure Limited NAV and Dividend update as at 30 June 2026 (FGEN LN, Renewable Energy Infrastructure, £542.3m mkt capn, 17.7% discount to NAV): NAV TR +1.4%; share price TR +28.2%; The portfolio continues to generate robust cash flows, with dividend cover expected to remain within the Company's target range of 1.2x to 1.3x, post project debt amortisation. Quarterly dividend of 2.01 pence per share declared, maintaining progress towards the Company's full-year dividend target of 8.04pps. Gearing of 29.2% (28.8% 31 March 2026). The Board remains focused on delivering the Company's progressive dividend strategy, alongside NAV growth through consistent operational performance, value enhancements and selective capital recycling.

Invesco Bond Income Plus Limited HY results to 30 June 2026 (BIPS LN, Debt – Loans & Bonds, £499.4m mkt capn, 1.6% premium to NAV): NAV TR +2.8%; share price TR +3.0%; interim dividends totalling 6.125pps declared, with a FY target of 12.25pps. 43.5m shares issued into demand in the period raising £74.8m proceeds, passing £500m in gross assets. Net gearing of 5.9% reflecting the portfolio managers’ assessment of the balance of opportunity and risk in the high yield market

JPMorgan Claverhouse Investment Trust HY results to 30 June 2026 (JCH LN, UK Equity Income, £527.8m mkt capn, 1.6% discount to NAV): NAV TR +6.6% vs FTSE All Share Index +7.2%; share price TR +9.3%; two interim dividends totalling 17pps declared in the period. While performance over the six-month review period lagged the benchmark, the Company's track record of longer-term outperformance remains intact. "Although UK inflation has now fallen sharply from the 30-year high seen in October 2022, the Board continues to monitor closely the outlook for portfolio dividend income and will draw prudently on revenue reserves, if necessary, to assist the Company to meet its dividend policy objectives and deliver a smooth dividend profile. This is a benefit of the investment trust structure." Gearing of 5.9% (5.4% December 2025)

Ruffer Investment Company July 2026 update (RICA LN, Flexible Investment, £868.0m mkt capn, 4.2% discount to NAV): The best-performing major asset in July was Brent crude oil (+24%) as the US-Iran conflict re-escalated, and bond yields rose too (bond prices fell), with the US 30 year yield reaching its highest level (5.3%) since 2007. The main negative contributor in the month was the bond position in the fund. Bond yields rose in part because the new Chair of the Federal Reserve, Kevin Warsh, failed to live up to market expectations that he would deliver on a stated intent to control inflation. "In the short term, investment is mainly about positioning: financial markets have a marvellous way of turning a good idea into a bad investment by funnelling too much capital towards it. Our view is that the utopian narrative surrounding AI makes it a bad place to find a margin of safety; meanwhile, there are rich pickings in the rest of the equity market. For protection, we are confident that bonds and the yen (alongside the short credit position) should provide good returns if equity markets fall materially."

Pershing Square Holdings HY results to 30 June 2026 (PSH LN, North America, £6,701.3m mkt capn, 36.1% discount to NAV): NAV TR -12.6% vs S&P 500 TR +10.2%; share price TR -23.9%, with the discount to NAV widening. "The Board was pleased to see that the current environment has created an exceptional opportunity for the investment manager to establish six new investments representing one of the most productive periods of new investment in the firm's history. The investment manager drew on a deep library of businesses that it has followed and admired for years and moved decisively when they became available at attractive valuations." Namely, Visa, Mastercard, Netflix, S&P Global, Intercontinental Exchange and Alcon. "A sustained narrowing of the discount is a priority for the Board, which keeps under active review the measures it has available to that end." Pershing Square USA raised $5bn in April 2026

Wind down / asset realization news

Riverstone Energy Limited Q2 2026 update (RSE LN, Commodities & Natural Resources, £28.1m mkt capn, 51.9% discount to NAV): Consistent with the managed wind-down announced in August 2025, the Company confirmed that it had redeemed 2.5m shares (circa 34.3% of share capital) for cancellation at a Redemption Price of £11.94pps. This decreased the Company's shares outstanding from 7,334,416 as of 31 March 2026 to 4,821,934 post-redemption. As the Company advances its managed wind-down, the manager's priorities have become increasingly focused. Capital allocation is now directed towards preserving value, supporting existing portfolio companies where appropriate and identifying disciplined exit opportunities capable of maximising returns for shareholders. While the timing of future realisations will inevitably depend upon market conditions and company-specific developments, the manager believes the remaining portfolio continue to comprise businesses operating in sectors supported by long-term demand for industrial electrification, energy efficiency and advanced manufacturing technologies. The Board and Investment Manager remain committed to executing the managed wind-down in an orderly manner while maintaining execution discipline, preserving shareholder value and returning realised capital in a timely and efficient manner.

Riverstone Credit Opportunities Income HY results to 30 June 2026 (RCOI LN, Debt – Direct Lending, £27.4m mkt capn, 18.0% discount to NAV): On 30 March 2026, the Company redeemed (on a pro rata basis) 12,134,802 Ordinary Shares at a redemption price of US$0.89 per Ordinary Share. Since the adoption of the managed wind-down investment policy, the Company has now redeemed approximately 59% of the Company's Ordinary Shares. Three assets remain. "During the first half of 2026, the Company's performance improved slightly from 2025 and posted solid earnings for the first half of the year." The Company will continue to focus on the realisation of the Company's remaining investments and the prompt return of capital to our shareholders.

Residential Secure Income (RESI LN, Property – UK Residential, £51.1m mkt capn, 68.3% discount to NAV): the Board has resolved to make a first capital distribution to Shareholders under the shareholder approved B Share Scheme of the £35.2m available. Alongside the initial B Share Scheme Return of Capital, the Board has resolved to make a property income distribution totalling approximately £2.8m or 1.53pps. The property income distribution and the initial B Share Scheme Return of Capital together total approximately £38.0m. Subject to ongoing due diligence, the Shared Ownership Portfolio is expected to be sold, for net consideration of approximately £13.5m of which £5m will be retained, and is expected to be released post completion, upon satisfaction of asset management deliverables. The completion of the disposal is expected to occur no later than 30 September 2026. Following completion of the disposal of the Shared Ownership portfolio, the Company will announce details of any further returns of either a property income distribution or capital under the B Share Scheme.

Asset purchase / disposal / portfolio news

RTW Biotech Opportunities Ltd (RTW LN, Healthcare & Biotechnology, £841.3m mkt capn, 8.7% discount to NAV): note the announcement by private portfolio company Avere Therapeutics of a $500m private placement following its previously announced $320m private placement and the planned merger with public company NextCure Inc. The two private placements are each expected to close immediately prior to the completion of the all-stock merger, which is expected to occur by year-end. The combined company will operate as Avere Therapeutics, Inc. and trade on Nasdaq. As of 30 June 2026, following the funding of the first $320m private placement, Avere represented 0.3% of RTW Bio's NAV. The second private placement of $500m, in which RTW Bio will also participate, is expected to close by year-end. The total investment by RTW in the first and second private placements is $5.9m. The Company subsequently put out its July update. NAV -1.6% vs Nasdaq Biotech Index -1.7% / Russell 2000 Biotech Index -4.4%

Proposed name change

CQS Natural Resources Growth & Income (CYN LN, Commodities & Natural Resources, £152.2m mkt capn, 1.3% premium to NAV): published a circular which contains a notice of a general meeting at which the Board is seeking Shareholders' approval for the change to the Company's articles of association to allow the directors to change the name of the Company. The Company's transition to the management of the portfolio by Tufton Investment Management Ltd is progressing well with the anticipated date of them taking over the management from 14 September as planned. As CQS Natural Resources Growth and Income PLC currently incorporates the name of the Company's incumbent manager, the directors wish to change the name to recognise the move and remove any legacy name overhang. While market practice has moved towards name changes being approved by a resolution of directors, the Company's articles still provide for a shareholder vote. The directors would like to amend the articles to allow flexibility to change the name. As such the directors propose a change to the articles to allow them to change the name of the Company by directors' resolution. Following the General Meeting the Board will consider options for the new name of the Company and announce it to the market once confirmed. The General Meeting will be held on Tuesday, 8 September 2026. (Frostrow client)

4. Sector data this week (AIC data, as at Thursday’s close)

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Equity Capital Markets / Investor demand

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Equity Capital Markets / Investor demand

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Ex Dividend

PSH 18.37cps, UAV 3.9pps, ICGT 9.5pps, BGUK 6.2pps, INPP 2.19pps, MAJE 2.5pps, UKW 2.68pps, SAIN 3.98pps, ORIT 1.56pps, BRAI 4.15pps, TRIG 1.8875pps, THRL 1.508pps, BBOX 2pps, NESF 1.77pps

Frostrow Investor Relations team – Messrs Grant Challis, Neil Winward, Matt Burrows, Nicholas Todd & Max Smith

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