AlphaScreens 

Buy the dip? Investment trust bargains

Buy the dip? Investment trust bargains

Investors are often told that it’s good to buy on the dips but when the stock market plunges like it has in the last two weeks, it’s important to accept things can get worse before they get better. Dripping money in gradually may be a better way to play emerging value opportunities.

 

  • Buyers of investment trusts might have the comfort that at least the underlying portfolio is falling less rapidly then the shares of the company itself. This has the effect of widening the discount, although it must be stressed you could still be trying to catch a falling knife.
  • Investing, however, is a long-term game and some of the trusts our screen signals are in value territory represent an attractive entry point to access the strategies of proven investment companies. Most strikingly, the £8.9bn market cap Scottish Mortgage Trust (SMT) ranks highly.
  • Other more specialist trusts represent powerful ways to play long-term growth trends, with the Biotech Growth Trust (BIOG) and Allianz Technology (ATT) ranking in our top ten.
  • Holding a good selection of investment trusts is a way to build a diversified portfolio that will ride out market turbulence and deliver stellar returns over time. 

 

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