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Daily Mail
01-08-2025
- Business
- Daily Mail
Investment trusts rise up from the ashes
A cloud can have a sizeable silver lining. The failure by Wall Street hotshot Boaz Weinstein to acquire seven investment trusts cheaply this year is sparking a rebound of the sector. Multi-millionaire Weinstein, who is chief investment officer of the activist Saba Capital hedge fund, may have thought shareholders would, unquestioningly, back his campaign. But they rejected his approaches, recognising the true value of their stakes in these trusts. Their resistance is bringing about an upheaval. It's time to think again if you thought trusts – some set up in Victorian days – were an anachronism. Darius McDermott, boss at funds ratings agency Fundcalibre, says: 'The sector was on its knees – no buyers, only sellers, and discounts and yields at record highs.' A trust is at a discount if its share price is below its net asset value (NAV). McDermott says: 'Sentiment has started to recover, and we think the best opportunities lie ahead. Professionals have spotted the value. It's time private investors took notice too.' Boards are taking tough decisions to shrink discounts. They are also exploring mergers or ordering reviews of their trusts' futures. The continued existence of more trusts is in question. New activist investors are emerging – and pressing for change. The main players are management groups Harwood Capital, which operates investment trust Achilles, and Asset Value Investors. The Asset Value Investors stable includes the Migo Opportunities trust, whose co-manager Charlotte Cuthbertson says: 'Activist agitation is the primary catalyst for returns now and can deliver a wealth of opportunities from once-in-a-generation discount levels.' She argues it is necessary: 'Sentiment alone won't close the gap between prices and NAVs.' Emma Bird, head of investment trust research at trader Winterflood Securities, says mergers will produce 'larger and more liquid trusts', presenting a more compelling long-term proposition. One illustration is last month's get-together of Henderson European and Fidelity European. But there is bid activity too. In May the FTSE 100 real estate investment trust (Reit) LondonMetric, which owns pubs, shops and Warwick Castle, paid £699m for the FTSE 350 'mega-shed' specialist Reit Urban Logistics. The bid price was an 11 per cent premium on Urban Logistics' price back in April, valuing the trust at a 5 per cent discount to its NAV. The deal was triggered by the Achilles trust, an investor in Urban Logistics. If you have been dismayed by the performance of trusts you hold, it makes sense to sit tight and hope that the shake-up gives a lift. But if you want to take advantage of disruption by activists, follow this guide. MIND THE GAP At the beginning of 2025, the average investment trust discount was 16pc –largely due to the superior returns paid by less risky deposit account and bonds. This has narrowed to 13 per cent – although brokers Stifel say the gap between price and NAV at 50 trusts is now 5 per cent or less. Biotech trust Syncona may be at a 50 per cent discount, but Seraphim Space has shrunk from 53 per cent to 15 per cent thanks to the recognition that its military application satellite investments will be boosted by increased defence spending. Bird says that share buybacks are one strategy being deployed by boards to reduce discounts. If you acquire a trust at a discount, you're buying assets for less. But there is an element of jeopardy, as no mechanism is guaranteed to minimise the gap between share price and the NAV. HOW TO BACK BRITAIN Winterflood's Emma Bird comments: 'There are arguably too many UK equity income trusts, which is why the board of Murray Income last month commissioned a review.' Murray is at a discount of 7 per cent. Directors may seek a merger or replace its managers Aberdeen. People with money in this trust, like me, will be happy for some resolution of the problem. It is also worth taking a closer look at the UK Equity Income sector. The best-buy City of London trust is at a premium of 1 per cent, but Diverse Income, another recommended trust, is at a discount of 4 per cent. Temple Bar, whose discount is just 0.41 per cent, is one of my backing-Britain investments; its portfolio encompasses Aviva, Marks & Spencer and NatWest. GET AN ENERGY BOOST In the infrastructure and renewable energy sector, yawning discounts indicate that bargains are to be found for those with patience. The typical discount on an infrastructure trust that invests in bridges, hospitals, roads etc, is about 14 per cent. This rises to about 25 per cent for trusts that back renewable energy projects, which has put them in the sights of the Migo Opportunities trust. Cuthbertson comments: 'This is where the next wave of activism is focused, and so are we.' Downing Renewables & Infrastructure has succumbed to a bid, at a 24 per cent premium to the price on June 19, but still below its NAV. As an investor I could have hoped for more but the dividend yield has been some compensation. The Law Debenture trust has just taken stakes in Greencoat UK Wind, where the discount is 19 per cent, and HICL Infrastructure which is at a discount of 20 per cent. HICL's holdings include hospitals and the Home Office building. Law Debenture managers consider the discounts on these two trusts to be 'unjustifiably high'. Both offer generous dividends which makes it worth waiting for developments. The SDCL Energy Efficiency trust has an attractive 11 per cent yield, as McDermott highlights – but is at a 38 per cent discount, so strong nerves are needed. Ben Yearsley of Fairview Investing is a fan of two other renewables trusts: Foresight Solar (discount 18 per cent) and Greencoat Renewables (24 per cent). BRICKS AND MORTAR Reits are an area where activists are hoping to exploit falling borrowing costs and rising rents. McDermott picks TR Property, which is at a 7 per cent discount. Cuthbertson cites Aberdeen European Logistics Income which has been selling chunks of its portfolio to address its discount of 18 per cent. She argues that further improvements should be in the offing. If you are up for an adventure, McDermott points to Chrysalis (discount 27 per cent) where holdings include the Swedish buy now, pay later group Klarna. Yearsley's pick is Artemis UK Future Leaders (15 per cent), a smaller companies trust. Or you could take a gamble on the activists producing a much better return. Achilles is at a tiny 0.19 per cent discount. Migo Opportunities, which has stakes in Chrysalis and SDCL Energy Efficiency, is at a discount of 4 per cent. This attention to the level of their own discounts bodes well for their ability to impress on other trusts the vital importance of this feature.
Globe and Mail
31-07-2025
- Business
- Globe and Mail
BRW Announces Notification of Sources of Distributions
Saba Capital Income & Opportunities Fund (NYSE: BRW) (the 'Fund'), a registered closed-end management investment company listed on the New York Stock Exchange, is notifying shareholders, prospective shareholders, and third parties of the sources of distributions pursuant to Section 19(a) of the Investment Company Act of 1940 (the 'Investment Company Act'). IMPORTANT INFORMATION REGARDING MONTHLY DISTRIBUTION Distribution Notice. Pursuant to Section 19(a) of the Investment Company Act, the Fund is providing its shareholders with an estimate of the source of the Fund's monthly distribution as required by current securities laws. The Fund's estimated sources of the distribution to be paid on July 31, 2025 and for the fiscal year 2025 year-to-date are as follows: Estimated Allocations for the distribution to be paid on July 31, 2025 (estimated as of July 24, 2025): Cumulative Estimated Allocations fiscal year-to-date as of June 30, 2025, for the fiscal year ending October 31, 2025: Distribution Per Share Net Investment Income Per Share and Percentage of Such Distribution Amount Net Realized Short-Term Capital Gains Per Share and Percentage of Such Distribution Amount Net Realized Long-Term Capital Gains Per Share and Percentage of Such Distribution Amount Return of Capital Per Share and Percentage of Such Distribution Amount $0.68000 $0.41295 (60.73%) $0.00000 (0.00%) $0.00000 (0.00%) $0.26705 (39.27%) Shareholders, prospective shareholders, and third parties should not draw any conclusions about the Fund's investment performance from the amount of this distribution or from the terms of the Fund's Plan (as defined below). The Fund estimates that it has distributed more than its income and net realized capital gains; therefore, a portion of the Fund's distribution to shareholders may be a return of capital. A return of capital may occur, for example, when some or all of the money that a shareholder invested in a Fund is paid back to them. A return of capital distribution does not necessarily reflect the Fund's investment performance and should not be confused with 'yield' or 'income.' The amounts and sources of distributions reported in this 19(a) Notice are only estimates and are not being provided for tax reporting purposes. The actual amounts and sources of the amounts for tax reporting purposes will depend upon the Fund's investment experience during the remainder of its fiscal year and may be subject to changes based on tax regulations. The Fund will send a Form 1099-DIV to shareholders for the calendar year that will describe how to report the Fund's distributions for federal income tax purposes. The determination of the actual source of distributions can only be made at year-end. The actual source amounts of all Fund distributions will be included in the Fund's annual or semi-annual reports. In addition, the tax treatment may differ from the accounting treatment used to calculate the source of the Fund's distributions as shown on shareholders' statements. Shareholders should refer to their Form 1099-DIV for the character and amount of distributions for income tax reporting purposes. The final determination of the source and tax characteristics of all distributions will be made after December 31, 2025 and reported to you on Form 1099-DIV early in 2026. Since each shareholder's tax situation is unique, it may be advisable to consult a tax advisor as to the appropriate treatment of Fund distributions. Effective after the close of business on June 4, 2021, Saba Capital Management, L.P. replaced Voya Financial as the investment adviser to Saba Capital Income & Opportunities Fund (formerly known as the Voya Prime Rate Trust). Performance of the Fund prior to the close of business on June 4, 2021 is not attributable to Saba Capital Management, L.P. Average Annual Total Return (in relation to the change in net asset value (NAV) for the 5-year period ended on June 30, 2025) 1 Annualized Distribution Rate (for the current fiscal period as a percentage of NAV as of June 30, 2025) 2 Cumulative Total Return (in relation to the change in NAV for the current fiscal period through June 30, 2025) 3 Cumulative Fiscal Year-To-Date Distribution Rate (as a percentage of NAV as of June 30, 2025) 4 9.82% 12.24% 15.67% 8.00% Fund Performance and Distribution Rate Information: 1 Average Annual Total Return in relation to NAV represents the compound average of the Annual NAV Total Returns of the Fund for the five-year period ended through June 30, 2025. Annual NAV Total Return is the percentage change in the Fund's NAV over a year, assuming reinvestment of distributions paid. 2 The Annualized Distribution Rate is the dollar value of distributions for the current fiscal period November 1, 2024 through June 30, 2025 annualized as a percentage of the Fund's NAV as of June 30, 2025. The level of distribution amount shown is not guaranteed and special dividends may or may not be paid in the future. Further, no conclusions should be drawn about the Fund's investment performance from the amount or rate of distribution shown. 3 Cumulative Total Return is the percentage change in the Fund's NAV from October 31, 2024 through June 30, 2025, assuming reinvestment of distributions paid. 4 The Cumulative Fiscal Year-To-Date Distribution Rate is the dollar value of distributions for the current fiscal period November 1, 2024 through June 30, 2025 as a percentage of the Fund's NAV as of June 30, 2025. The level of distribution amount shown is not guaranteed and special dividends may or may not be paid in the future. Further, no conclusions should be drawn about the Fund's investment performance from the amount or rate of distribution shown. Managed Distribution Plan. The above distribution was declared in accordance with the Fund's currently effective managed distribution plan (the 'Plan'), whereby the Fund will make monthly distributions to shareholders at a fixed amount of $0.085 per share. Thus, the distribution amount shown excludes special dividends (which are not paid pursuant to the plan). The Fund will generally distribute amounts necessary to satisfy the Fund's Plan and the requirements prescribed by excise tax rules and Subchapter M of the Internal Revenue Code. The Plan is intended to provide shareholders with a constant, but not guaranteed, fixed minimum rate of distribution each month and is intended to narrow the discount between the market price and the net asset value of the Fund's common shares, but there is no assurance that the Plan will be successful in doing so. Under the Plan, to the extent that sufficient investment income is not available on a monthly basis, the Fund will distribute long-term capital gains and/or return of capital in order to maintain its managed distribution rate. As a result, long-term capital gains and/or return of capital may be a material source of any distribution. No conclusions should be drawn about the Fund's investment performance from the amount of the Fund's distributions or from the terms of the Fund's Plan. The Board of Trustees (the 'Board') may amend the terms of the Plan or terminate the Plan at any time without prior notice to Fund shareholders. No level of distribution can be guaranteed. The amendment or termination of the Plan could have an adverse effect on the market price of the Fund's common shares. The Plan is subject to the periodic review by the Board, including a yearly review of the annual minimum fixed rate to determine if an adjustment should be made. Past Performance is No Assurance of Future Results. Investment return and principal value of an investment in the Fund will fluctuate. Shares, when sold, may be worth more or less than their original cost. Investors should consider the investment objective, risks and expenses carefully. You can obtain the Fund's most recent periodic reports and filings by visiting Other Information and Certain Risk Factors: The Fund's investment objective is to provide investors with a high level of current income, with a secondary goal of capital appreciation. There can be no assurance that the Fund will meet its investment objective. The Fund seeks to achieve this objective by investing globally in debt and equity securities of public and private companies, which includes, among other things, investments in closed‐end funds, special purpose acquisition companies ('SPACs'), reinsurance, and public and private debt instruments. The Fund also may utilize derivatives including but not limited to total return swaps, credit default swaps, options and futures, in seeking to enhance returns and/or to reduce portfolio risk. The value of the Fund's investments in equity securities of public and private, listed and unlisted companies and equity derivatives generally varies with the performance of the issuer and movements in the equity markets more generally. As a result, the Fund may suffer losses if it invests in equity instruments of issuers whose performance diverges from the Fund's investment manager's expectations or if equity markets generally move in a single direction and the Fund has not hedged against such a general move. The Fund invests in closed-end funds and SPACs, which are subject to additional risks and considerations. The performance of reinsurance-related securities and the reinsurance industry itself are tied to the occurrence of various triggering events, including but not limited to weather, natural disasters (hurricanes, earthquakes, etc.), non-natural large catastrophes and other specified events causing physical and/or economic loss. To the extent the Fund invests in reinsurance-related securities for which a triggering event occurs, losses associated with such event could result in losses to the Fund's investment, and a series of major triggering events affecting a large portion of the reinsurance- related securities held by the Fund could result in substantial losses to the Fund's investment. The Fund may invest in high yield securities, which are speculative in nature and are subject to additional risk factors such as increased possibility of default, illiquidity of the security, and changes in value based on changes in interest rates. Changes in short-term market interest rates may directly affect the yield on the Fund's common shares. If such rates fall, the Fund's yield may also fall. If interest rate spreads on bonds and loans owned by the Fund decline in general, the yield on the bonds and loans will likely fall and the value of such bonds and loans may decrease. When short-term market interest rates rise, because of the lag between changes in such short-term rates and the resetting of the floating rates on bonds and loans in the Fund's portfolio, the impact of rising rates will be delayed to the extent of such lag. Because of the limited secondary market for certain bonds and loans, the Fund's ability to sell such securities in a timely fashion and/or at a favorable price may be limited. An increase in the demand for bonds and loans may adversely affect the rate of interest payable on new bonds and loans acquired by the Fund, and it may also increase the price of bonds and loans purchased by the Fund in the secondary market. A decrease in the demand for bonds and loans may adversely affect the price of bonds and loans in the Fund's portfolio, which would cause the Fund's net asset value to decrease. The Fund's use of leverage, if any, through borrowings or issuance of preferred shares can adversely affect the yield on the Fund's common shares. Investment in foreign borrowers involves special risks, including but not limited to potentially less rigorous accounting requirements, differing legal systems and potential political, social and economic adversity. The Fund may engage in currency exchange transactions to seek to hedge, as closely as practicable, all of the economic impact to the Fund arising from foreign currency fluctuations. Other risks include, but are not limited to, the use of derivatives, the potential lack of diversification in the Fund's portfolio, and the fact that the Fund's portfolio may be concentrated in a small group of industries or industry sectors from time to time. Investors should consult the Fund's filings with the Securities and Exchange Commission as well as the materials on the Fund's website for a more detailed discussion of these or other risk factors that affect the Fund. About Saba Capital Income & Opportunities Fund. Saba Capital Income & Opportunities Fund is a publicly-traded registered closed-end management investment company. The Fund's common shares trade on the New York Stock Exchange under the ticker symbol 'BRW'. The Fund is managed by Saba Capital Management, L.P. Forward-Looking Statements. This press release contains forward-looking statements subject to the inherent uncertainties in predicting future results and conditions. Any statements that are not statements of historical fact (including but not limited to statements containing the words 'believes,' 'plans,' 'anticipates,' 'expects,' 'estimates' and similar expressions) should also be considered to be forward-looking statements. These statements are not guarantees of future performance, conditions or results and involve a number of risks and uncertainties. Certain factors could cause actual results and conditions to differ materially from those projected in these forward-looking statements. These factors, including but not limited to the 'Certain Risk Factors' noted above, are identified from time to time in the Fund's filings with the Securities and Exchange Commission as well as the materials on the Fund's website. The Fund undertakes no obligation to update such statements to reflect subsequent events, except as may be required by law.
Bloomberg
27-06-2025
- Business
- Bloomberg
Boaz Weinstein on Card Counting, Private Credit and Night Sweats
Boaz Weinstein, founder and chief investment officer of Saba Capital, spoke with Sonali Basak at a blackjack table in Atlantic City. (Source: Bloomberg)
Yahoo
17-06-2025
- Business
- Yahoo
Saba Capital Announces Final Voting Results of Special Meeting of ASA Gold and Precious Metals Shareholders
ASA Shareholders Vote to Expand Board to Five Members and to Elect Independent Governance Expert Maryann Bruce NEW YORK, June 17, 2025--(BUSINESS WIRE)--Saba Capital Management, L.P. (together with certain of its affiliates, "Saba"), the largest common shareholder of ASA Gold and Precious Metals Limited (NYSE: ASA) ("ASA" or the "Fund") with 17.2% ownership of the Fund's outstanding shares, today announced the final certified voting results of the Fund's Special Meeting of Shareholders (the "Special Meeting") held on June 13, 2025. The final voting results of the Special Meeting confirm that shareholders voted to expand ASA's Board of Directors (the "Board") to five members and to elect independent candidate Maryann Bruce as the fifth director. The five-member Board is now composed of Maryann Bruce, Ketu Desai, William Donovan, Mary Joan Hoene and Paul Kazarian. The Board will serve until the 2025 Annual Meeting of Shareholders, at which time shareholders will vote on the composition of the entire Board. The final voting results have been certified by the independent Inspector of Elections. About Saba Capital Saba Capital Management, L.P. is a global alternative asset management firm that seeks to deliver superior risk-adjusted returns for a diverse group of clients. Founded in 2009 by Boaz Weinstein, Saba is a pioneer of credit relative value strategies and capital structure arbitrage. Saba has offices in New York City and London. Learn more at View source version on Contacts Longacre Square PartnersKate Sylvester, 646-386-0091ksylvester@
Daily Mail
31-05-2025
- Business
- Daily Mail
JEFF PRESTRIDGE: There ARE simple ways for trusts to boost their shares
Investments trusts are a super way for investors to get long-term exposure to stock markets – and make some money along the way. They're easy to buy and sell, and most provide value for money. Yet they are not without flaws, as predators such as American hedge fund manager Saba Capital have sought to exploit. The biggest one is that as funds listed on the London Stock Exchange, their share prices do not always reflect their underlying asset value. In most cases, they undervalue them. In investment speak, they trade at a discount. When this happens, shareholders see the worth of their investments eroded. It's frustrating. The average discount industrywide is currently about 15 per cent. Trust shares trade at discounts for many reasons: out of vogue investment mandates; an unappealing stock market (as London has been for quite a while); and an unfriendly economic and financial backdrop. Yet underpinning all these reasons is a mismatch between buyers and sellers. More investors want out than in. Saba has sought to make money from this by buying stakes in undervalued investment trusts and then agitating for change. So far it hasn't managed to take any trusts under its wing, but it has helped close discounts on some trusts, making money in the process. A few days ago I spoke to Richard Curling, chairman of trust Montanaro European Smaller Companies (MESC), about discounts. The £277 million trust has Saba among its shareholders. Curling says investment trusts must do more to reduce the 'volatility' in share price discounts. At MESC, he has implemented a three-prong strategy designed to drive down the trust's discount. It has involved buying back shares (in effect reducing their supply to make them scarcer); allowing investors twice a year to exit the trust at close to asset value; and reducing the annual charge from 0.9 to 0.825 per cent. Although early days, it's working. The trust's discount is now 8 per cent, more than half what it was in November last year (Saba has taken advantage of this to trim its stake). And unlike many other trust chairs, Curling has a bit of get up and go about him. Curling believes the investment trust industry needs to do far more to attract investors – young and old – something which would help drive down discounts. His ideas include the use of social media to get younger people interested in investing, and the removal of jargon from key literature such as annual reports. He adds: 'We must present our case better to potential investors. Plain English, not jargon.' Curling is bang on the nail. Although stellar investment performance will always be the number one priority for investors (MESC's share price is up 17 per cent over the past year), investment trusts must become more relevant to today's investors. Otherwise there is a danger many will be undermined by discounts. On a related issue, the industry's flag waver, the Association of Investment Companies (AIC), is calling for a change in UK company law that would ensure more trust shareholders vote on key issues, such as a trust's discontinuation or takeover. Currently, many shareholders are thwarted from voting because the platform they hold their investments with don't pass on details. The AIC has launched a petition on this issue. It needs 10,000 signatures for the Government to respond ( As a fan of trusts and investor empowerment, I've put my name to it, as have 1,798 other people. Are there 8,202 lovers of investment trusts out there who will get the petition to the next step? I do hope so. Leave Gift Aid alone, Rachel Gift Aid is a financial lifeline to many charities left battered and bruised by Chancellor Rachel Reeves's recent hike in employer National Insurance costs. It boosts the coffers of 66,000 charities by £1.6 billion a year. This month, I am doing two Race For Life runs for fabulous charity Cancer Research UK – a 5km event in London's Battersea Park, followed by a 10km run in glorious Worthing, West Sussex (I have a thing about piers). So far, Gift Aid, a 25 per cent top-up on donations, has increased my fundraising by more than £180. So, Rachel, I know you've made a pig's ear of the country's finances, but please leave Gift Aid alone come the Autumn Budget. You've hit charities once in the pocket. Twice would be cruel beyond cruel. Rachel de Vil. Watch out for your bank sneakily dropping chip and pin payments Like many readers, retired teacher Moira McCormick isn't a fan of new banking technology. She prefers cards that require a personal identification number (PIN) to contactless. 'It provides me with a layer of financial protection,' she says. But recently she used her card to pay for parking at her local Banbury railway station, only for the payment to be completed without requiring a PIN. Worried that anyone could use her card to pay for parking if she were to lose it, she contacted Chiltern Railways (operator of the car park) for an explanation. She was told that Mastercard and Visa have informed the company which provides the payment service for Chiltern's ticket machines that 'insecure unencrypted PIN validation' was no longer permitted. She was told to contact her card issuer (HSBC) for a replacement that asks for PIN verification. Chiltern informed her that some cardholders with Lloyds and Royal Bank of Scotland (NatWest) were also affected. 'I was told the change is meant to improve the security of my card,' says Moira, 'but it's now less secure. Anyone could use it if I lost it.' Indeed, when sales director Bradford Bines, from Leigh-on-Sea in Essex, lost a card in a Manchester car park, he later discovered it was fraudulently used 29 times by exiting drivers. HSBC insisted that changes to the technology were designed to make cards 'more secure from criminals trying to steal data'. Moira's non-PIN payment, it said, was deemed to be 'low value and low risk', adding: 'A decision was made to approve this payment without a PIN for the convenience of the customer.' Moira isn't happy. She says HSBC should have informed her that some payments would no longer require a PIN. Fair point.
