Infrastructure investment trusts have been highly prized by investors for their low-risk access to predictable, inflation-linked income streams in recent years. As a result these trusts have often traded at extremely high premiums to net asset value (NAV), making them a pricey investment. IC Top 100 Fund , HICL Infrastructure 's (HICL) premium to NAV climbed to an eye-watering 27 per cent in August, for example.
- Inflation-linked income
- Direct exposure to infrastructure
- Good performance record
- Attractive yield
- Premium lower than average
- Premium could fall further
But following the electoral victory of Donald Trump - whose policies are expected to increase inflation - investors have been dumping government bonds, and so called 'bond proxies' such as infrastructure assets have also been hit. As of 5 December, HICL's premium was down to 13.3 per cent, which was below its 12-month average of 16.8 per cent. This means it could be a good time to add it to your portfolio.