Since this column takes a long-term view and tends to favor managers who are willing to deviate materially from their benchmark composition, the limited number of trust holdings is not considered a negative.
Major holdings include high-quality companies such as AstraZeneca, Unilever, GSK, and Glencore.
Although their positions are made up exclusively of UK-listed stocks, they are global businesses that depend on the performance of the global economy.
And with the global economy expected to produce a stronger performance as inflation falls, interest rates rise and China’s reopening positively impacts global activity levels, the outlook for the trust’s holdings will improve.
With the trust having a leverage ratio of approximately 11 percent, it is well placed to benefit from the prospect of improved corporate performance and stronger investment sentiment.
Although a 0.5% discount on Net Asset Value is very modest compared to the rock-bottom valuations of some mutual funds, a track record of consistently outperforming the index means the company offers good value for money.
In Questor’s view, the Schroder Income Growth Investment Trust remains as attractive now as it was when it was first added to our income portfolio more than six years ago.
Its attractive yield, reliable dividend growth track record and solid strategy mean it offers a simple, yet highly rewarding path to a worthwhile income yield for years to come.
Questor says: Wait
Listing code: SCF
Closing share price: 300.5p
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