Class divide

Article Abstract:

Split capital trusts have tended to perform well because they invest in blue chip stocks which have seen strong price rises. Trusts vary according to charges and the markets that they invest in, and there are also different split capital stock classes. Some split capital trusts include fixed interest securities which can help to boost yields, but which can also depress capital growth. Most split capital trusts will include zero dividend preference stocks, and there may alsobe income stocks. Ordinary stocks may also be available, combining income and capital stocks.

Personal Financial Mgmt

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Champion trusts swagger to a premium

Article Abstract:

United Kingdom investment trusts suffered a widening of discounts in 1997, and this hit sellers of trust stocks, though has benefited buyers. Discounts disappear when there is strong demand for trusts, and they are replaced by premiums. Buyers need to assess why there is a premium for such trusts. A premium may occur because a trust is seen as offering a unique opportunity and is a new issue. Investors can seek to identify trusts showing an improvement that is likely to lead to a premium.

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