FTSE All-Share Index

The question we need to ask is what's going to be the catalyst for the all share? to beat the markets, rather than just the FTSE 100 keeping pace with the S&P 500, which has been the best-performing market in many respects.

And that is what we've got to examine, perhaps, if we believe the FTSE All-Share is going to outperform over the next five years.

absolutely i mean looking looking at the uh this sort of stats the various indices the all share has lagged without a shadow without a shadow of a doubt um which implies that smaller medium-sized companies have really been a drag on on overall performance because the ftse 100 has been been very strong um before we come on to that um you know you've said you're going to remain focused on value What value is left in the FTSE 100? What do valuations look like? Are we still in somewhat subdued territory?

Well, yes, still.

Uh, yeah.

So, um, uh, just to be clear, um, we, we had a, the, the benchmark was the FTSE All-Share, and it's been that-

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since inception.

Uh, but really the FTSE All-Share doesn't reflect the opportunity set of invest in investment companies.

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So the two portfolios somewhat help each other in achieving the aims and objectives.

And as of this financial year, directors in conjunction with us as investment managers have helped try to frame performance and objectives by moving away from the defined benchmark of the FTSE All-Share for the two trusts to a series of comparators.

So those three comparators are as the following.

The FTSE All-Share remains, which acts as a sort of broad opportunity cost for investors and their investments.

But introducing the FTSE closed ended investments index, which is really the market cap weighted index of all of the investment trusts in the UK listed market, which represents the opportunity for both the growth and income portfolios, as well as CPI, the consumer price index.

And that's really to help investors be aware that through investing, they're able to grow their capital over the medium term and beat inflation.

but a trust which are invested in alternative asset classes, such as infrastructure, where they're able to grow that capital, grow the dividends for investors, and we think it makes a compelling total return.

To fund this, much like the growth portfolio, we've reduced the UK investment trust exposure quite materially, down just over 20%.

So there's something known as the equity premium puzzle.

So this is the difference in returns between equities, let's say the FTSE All-Share, and investing in gilts.

And the FTSE All-Share might beat gilts by maybe 7% per year on average, and people might think, "Well, that's fine," but that's just because they're riskier.

So there's no free money here.

They give a higher return, but that's because of people are risk-averse.

And actually in the three months then, from the end of March to the end of June, the trust did much better.

Its assets grew by 9.1% against 4.7% for the FTSE All Share.

So it's very early days, but a good signal there that there has been some kind of turnaround.

And this follows what was a pretty radical overhaul of the portfolio, a surprisingly large overhaul.

And as I mentioned earlier, the current yield is 5.7%.

this graph shows the nav and share price total return of the company in the light and dark blue versus the ftse all share in the dotted gray at the bottom and i think this demonstrates the significant outperformance over the long term and the power of compounding with the company returning over three times the gains of the FTSE All Share over the period.

Over the shorter term, returns have been resilient, but more modest.

And hopefully we'll see a return to the double digit returns as M&A markets recover and exit activity picks up.