These 8.7%-Paying Funds Just Got Their Day in Court (and We Won) by Michael Foster, Investment Strategist Every now and then, something happens that shines a light on the value of our favorite income investments – our 8%+ paying closed-end funds (CEFs). These stout income plays are so valuable, in fact, that some activists are willing to go all the way to the Supreme Court to gain more influence over them. Let me explain. A couple weeks ago, the nation’s top court released a decision that meant a lot for CEFs, including those in the portfolio of our CEF Insider service, which yields 8.7% on average as I write this. Let me set the scene, starting with the activist in the spotlight. That would be Saba Capital, a hedge fund that’s been agitating for change among CEFs for years. As is the case with all activists, some of Saba’s suggestions are good, some less so. In this case, Saba’s proposal was so strong it prompted the CEF industry to fight back, starting the matter on the road to the top court. In short, Saba wanted the power to void CEF bylaws that restrict activist shareholders’ voting power. To understand this, remember that a CEF is technically a company, and as such, it has its own bylaws that state what investors, managers and other attached parties can and cannot do to the CEF. One such bylaw in many (but not all) CEFs is a restriction on how much voting power an activist fund can have, even if they own a large portion of the fund. Saba wanted more than just greater voting power: They effectively wanted power to sue CEF managers if they were still unable to get their proposals enacted. This would allow activists (like Saba) to effectively void bylaws in the CEF. In other words, if an activist were to own part of a CEF, and that activist felt a bylaw was against their interest, this move would have given them the power to sue in a bid to force the CEF’s managers to change it. After several court victories for Saba, CEF managers asked the Supreme Court to hear the case. They did, and the justices decided against Saba’s plan. The managers of these CEFs are no doubt happy with this outcome. But what’s best for CEF managers isn’t always best for investors, so is this victory really good for us? One way to get a sense of that is to look at the movements in the discounts to net asset value (NAV, or the value of a CEF’s underlying portfolio) on the funds mentioned in the above-linked CNBC story. Those funds are FS Credit Opportunities Corp. (FSCO), the Adams Diversified Equity Fund (ADX), the Adams Natural Resources Fund (PEO) and Royce Global Trust (RGT). If these funds’ discounts have widened since the news in any major way, it would be a sign that investors see this development as a negative for CEF buyers. Activist Case Loses, CEF Investors Shrug  As you can see, these funds’ discounts have been largely static for the last few months, with only FSCO’s already wide 30% discount growing larger, but only a bit. This makes sense, as the case was unlikely to go in Saba’s favor. The Supreme Court’s decision was 6-3 against, with the votes splitting along partisan lines. The market expected that outcome. The bottom line here is that yes, this move is a win for CEF investors, in large part because of this decision’s effect on these funds’ costs. There are two effects Saba’s proposal could’ve had on CEFs, had it won. First, it could’ve led to constant changes to CEF mandates and strategies, making it harder to manage the funds and introducing uncertainty. Markets, of course, hate uncertainty, so CEFs’ average discounts would likely have widened by quite a bit. Second, CEFs could have faced a wave of lawsuits from activists, costing time and money. Lawsuits, of course, are far from cheap, especially corporate lawsuits, so we could expect CEF fees to rise. This, by the way, is not a condemnation of Saba – far from it. The firm has done a good job of forcing some CEFs to improve, such as ADX, which Saba pressured to increase its regular dividend in 2024. The fund’s discount has nearly disappeared since then. Saba’s Pressure Narrowed ADX’s Discount  This was a direct benefit for CEF Insider readers, since ADX has been in our portfolio since July 2017 and has returned 317% for us since, as of this writing. But this latest proposal went too far. We’re happy with the court’s decision.

Dividends can be more reliable than share prices as they’re driven by
the companies performance itself and not by the whim of investors.

As part of a total return / reinvestment strategy, this income could be
reinvested into income assets or back into the equity market
depending on the relative valuations.

The emotional benefits of dividend re-investment.
In fact, with this investment strategy you can actually welcome falling share prices.

If you want to build a capital fund for part of your Snowball, you could have two investment pots and rebalance regularly maintaining similar percentages, depending on how each pot has performed.

Ian Cowie

Our columnist reflects on the top names over a very specific 30-year stretch.

25th June 2026 10:30

by Ian Cowie from interactive investor

Preparing for tomorrow’s 30th anniversary of an epoch-defining event prompted me to wonder which investment trusts delivered the highest total returns over what could reasonably be regarded as a shareholding lifetime. 

Wage slaves might work for 40 years but few of us had cash to spare in that first decade before stock market investment paved the way to financial freedom.

Here and now, several long-term top-performing trusts continue to be priced at double-digit discounts to their net asset values (NAVs) and could prove to be bargains for buyers today. Perhaps “value”, not “variety” is the spice of life.

So, leaving you to guess about that “epoch-defining event” until later, here are the top 10 investment trusts since 1996 according to Morningstar. 

Sad to say, I only own shares in one of them and failed to buy it soon enough to make the most of its long-term compounding magic.

More importantly, analysis by Association of Investment Companies (AIC) research director Nick Britton shows that the average return across all investment trusts that traded throughout these three decades shows they easily beat inflation and preserved the real value or purchasing power of investors’ cash. 

To do so, the Bank of England reckons we needed to turn £1,000 in June 1996 into £2,065 today.

By contrast, the top-performing fund over those 30 years was Allianz Technology Trust Ord  ATT

which transformed an initial investment of £1,000 into an eye-stretching £66,053. 

Despite such sustained strong performance, shares in this £2.8 billion fund continue to trade around 8% below their NAV. My favourite tech trust, Polar Capital Technology Ord  PCTdidn’t launch until December 1996, so fails the 30-year remit.

Ranking second overall, HgCapital Trust Ord  HGT

 demonstrated long-term capital growth from private equity – or assets that are not listed on any stock exchange – with a total return from the same £1,000 starting point of £47,338. 

HGT remains priced 29% below its NAV after actually shrinking shareholders’ capital by 17% over the last year. Enthusiasts argue that this might be a buying opportunity.

Third came 3i Group Ord  III

another giant of the private equity sector, which turned £1,000 into £45,964. 

Even total assets of £31 billion are not enough to allay worries about the valuation of unlisted assets, although an encouraging trading update caused the share price to pop nearly 9% higher on Thursday morning.

Fourth is closest to my wallet, the “forever fund” holding Scottish Mortgage Ord  SMT

which turned the usual starting investment into £41,200. If only I had been there 30 years ago! 

As discussed here recently, a fifth of this £19.1 billion global fund is invested in Space Exploration Technologies Corp Class A  SPCX

Elon Musk’s extraterrestrial conglomerate. 

But amid all that excitement, SMT shares actually trade on a discount of around 9%.

Fifth out of all closed-end funds, Aberdeen Asia Focus PLC  AAS

 finished the period with a total value of £40,017. This smaller companies specialist, focused on the Far East, consistently delivered capital growth but remains priced 11% below NAV.

Sixth, and closer to home, the UK smaller companies trust, Rights & Issues Investment Trust Ord  RIII

 ended the period with a value of £33,874. Despite such massive capital growth, plus a running dividend yield of 2%, RII continues to change hands at a 19% discount.

In seventh place stands another smaller companies specialist, albeit overseas on the Continent, JPMorgan European Discovery Ord  JEDT

which achieved an end value of £32,434. Its dividend yield of 2.4% helped squeeze the discount down to 8.7%.

Eighth-ranked Fidelity European Trust Ord  FEV focused on bigger continental companies, ended the period with £31,204. 

Underlying holdings are led by ASML Holding NV  ASML

the Dutch business that makes the machines that make microchips, followed by the Swiss pharmaceutical giant Roche Holding AG Ordinary Shares new  ROP

and the French firm Schneider Electric SE SU0.

Dividend income of 2.3% trims FEV’s discount to around 5%.

In ninth there’s Pacific Horizon Ord  PHI

which generated a total return of £30,767 from Asia excluding Japan. 

Taiwan Semiconductor Manufacturing Co Ltd ADR TSM

followed by South Korea’s Samsung Electronics Co Ltd DR  SMSN

2.76% and China’s Tencent Holdings Ltd 7000.95%, are the top three underlying holdings. Dividends are negligible at 0.2% but a 10% discount might tempt bargain-hunters.

Finally, Fidelity Special Values Ord  FSV

the UK All Companies blue chip, props up our top 10 trusts over the last three decades. 

Its dividend yield of 2.25%, rising by an annualised average of 12% over the last five years, means FSV trades near to par at a discount of less than 1%.

Britton, of the AIC, told me: “Investment trusts are built to compound returns over time. Their structure lends itself to long-term thinking, giving boards and managers the scope to extend the time horizon of their investment strategies – including the modest use of gearing to boost returns.

“The average trust has turned £1,000 into £16,700 over three decades, equivalent to an annual return of 9.8%.”

By contrast, the Bank of England reckons annual returns of only 2.42% were needed to keep pace with inflation since June 1996. 

How important income and indexation are depends on each individual investor’s objectives or, in plain English, what you want or, perhaps, what you really, really want.

For anyone still wondering which “epoch-defining event” occurred 30 years ago tomorrow on 26 June, it was – of course – the release of the Spice Girls’ debut single Wannabe. Ring any bells?

So, tell me what you want, what you really, really want. I’ll tell you what I want, what I really, really want. 

Long-term capital growth with rising income will do for me. Slam your money down and wind it all around; slam your money down and wind it all around!

The simple formula that reveals how long it will take to double your money

Story by Rachel Lacey

Graphic of a formula on a piggy bank

The Telegraph

One of the most common questions people have when they start investing is: “How fast will my money grow?”

The honest answer is likely to begin with “Well, it depends…”, but there is a handy formula to give you a rough idea of how long it will take to double in value.

Here, Telegraph Money explains how to use the “rule of 72”, and how it could help you make decisions about your savings, borrowing and pensions, but only if you use it properly.

What is the ‘rule of 72’?

“The rule of 72 is a useful financial planning tool. The simple formula helps investors and savers estimate how long it will take them to double their money,” said Jemma Slingo, pensions and investment specialist at Fidelity International.

“The maths is pleasingly straightforward. Just divide 72 by your average return, or your average interest rate, to calculate an estimate in years.”

So, for example, if you have an investment with a 6pc average annual return, your money will double in approximately 12 years (72 ÷ 6 = 12).

Or, if your investment yields a punchier 8pc a year, it will only take nine years or so to double your money (72 ÷ 8 = 9).

The formula will also work in reverse, said Laura Suter, director of personal finance at AJ Bell. “If you want to know what rate of return you’d need to double your money in 10 years, for example, divide 72 by 10 and you’ll get 7.2pc.

“It’s not exact, but it’s a useful guide.”

David Little, chartered financial planner at Evelyn Partners, added: “No calculator or compound interest table is required to make the calculation. The simplicity is exactly why [the rule] is so widely quoted.”

The rule of 72 isn’t just for investments

The rule of 72 is most often employed with investments, but Ms Suter pointed out it’s not its only use.

“Most people think of it purely in terms of investment growth, but it applies anywhere compounding is at work.”

For example, you can also use it to give you an idea of how quickly debts, such as credit cards, can grow if they aren’t repaid.

“Compounding works both ways,” said Mr Little. “A balance growing at 18pc a year doubles in four years (72 ÷ 18). Many borrowers underestimate this, and the rule of 72 makes the reality – and the danger – of debt instantly clear.”

You can also use this rule to highlight the threat of inflation to your cash. By taking the number 72 and dividing it by the prevailing rate of inflation, it’s possible to calculate how long it will take for the spending power of your money today to halve. This can be particularly useful when it comes to planning retirement income.

Ms Slingo said: “If inflation settled at 3pc, you could input this number into the formula to determine it would take roughly 24 years for your purchasing power to halve. This is a sobering thought, given the current state of inflation.

How helpful is the rule for financial planning?

The rule of 72 could, potentially, guide you to make more informed financial decisions.

For example, if you’re comparing cash or stocks and shares Isas as a long-term home for your money, applying the rule of 72 can highlight the power of compounding and give you the nudge to invest.

According to the rule, a cash Isa earning an average rate of 3pc a year would take 24 years to double. But a stocks and shares Isa with an average annual return of 6pc would double in half that time.

Remember if you only have a modest amount in your Snowball but intend to add when you can, compound interest takes a few years to make a noticeable difference. So the sooner you start the sooner you will finish.

I’ve sold the shares in SDV for a profit of £78 including the earned dividend but not yet received. Whilst this years income is well ahead of target, the SNOWBALL needs a higher yielder looking ahead to next year’s income.

Real Estate Credit Investments Limited (the “Company”)

Ordinary Dividend for RECI LN (Ordinary shares)

Real Estate Credit Investments Limited announces today that it has declared a fourth interim dividend of 3.0 pence per Ordinary Share for the year ended 31 March 2026. The dividend is to be paid on 24 July 2026 to Ordinary Shareholders on the register at the close of business on 3 July 2026. The ex-dividend date is 2 July 2026.

AI Volatility Hits Market: Dividend Safety Remains Intact

Jun 23, 2026 AEP, THG

SA Quant Strategist

Summary

• A hawkish Fed and a global tech rout, driven by an AI-euphoria reality check, prompted a market sell-off in today’s trading – the eve of Micron Technology’s third quarter earnings announcement.
• Heavy concentration in artificial intelligence has structurally transformed the equity environment, amplifying routine headline noise into frequent and severe tech sell-offs.
• Prioritizing stocks with elite dividend safety grades delivers a reliable, anxiety-free harbor that actively cushions a long-term portfolio against these sharp market drawdowns.
• Discover two high-quality dividend stocks, supported by strong Quant Ratings, that offer dependable income and defensive characteristics in an increasingly unpredictable market.
• I am Steven Cress, Head of Quantitative Strategies at Seeking Alpha. I manage the quant ratings and factor grades on stocks and ETFs in Seeking Alpha Premium. I also lead Quant Growth and Income, which is a model portfolio for dividend investors interested in capital appreciation and income.

AI-Driven Volatility

Today’s steep tech-led decline, spearheaded by a retreat in the Nasdaq (NDX) and high-flying AI and semiconductor stocks, is yet another reminder to investors just how fragile this high altitude market environment has become.

While the broader market rally seemingly moves higher, the air pockets of market turbulence are hitting with a greater frequency and magnitude. U.S. stocks have reached higher valuations than the levels seen in 1929 and the dot.com bubble.

As valuations and earnings push markets to new heights, volatility seems to be growing as well. On the surface, it may appear that the markets are being driven by a revolving door of headline catalysts -geopolitical events, economic reports, or a sudden drop in international markets. However, this headline-driven chaos isn’t happening in a vacuum. It’s being fueled by the structural shift that AI is having on the markets, and these two factors of structural AI change and headline catalysts continue to play off each other. Because index performance has become so heavily concentrated in AI and broader tech, markets have become more exposed to these sudden reactions.

This chart shows that the relationship between forward implied volatility of several tech-sector benchmarks relative to the broad market (SPX) is accelerating at a tremendous rate. The implied volatility ratio for the VanEck Semiconductor ETF (SMH) has skyrocketed to an extreme high of 2.67 relative to the SPX. The MSCI South Korea ETF (EWY), which generally serves as a proxy for global memory chip manufacturing, has blown past historic norms to a massive 3.76 ratio. And both the broader Nasdaq 100 (NDX) and tech sector (XLK) are pressing up against their absolute highest volatility premiums of this cycle. With tech concentration hitting new highs, its influence over inducing market volatility continues to grow with it.

Amid the erratic market changes, many investors would prefer a bit more predictability and a lot less anxiety – safety.

Historically, that stability has not been found in tech growth stories or rate-sensitive sectors, but rather in companies supported by resilient demand, strong pricing power, and recurring cash flows. When the market becomes unpredictable, investors should consider stable income and lower risk from top dividend-paying and income-based stocks. To find these opportunities, we can look to Seeking Alpha’s Quant Model, which points us to two top-rated dividend stocks with excellent dividend safety grades.

Top Dividend Stocks

To select the top dividend stocks to feature in this article, I used the Seeking Alpha Stock Screener and chose the pre-selected Top-Rated High Dividend Stocks and filtered for Quant Strong Buys/Buys and a Dividend Safety Grade of an A or higher.

1. American Electric Power Company, Inc. (AEP)

• Market Capitalization: $70.90B
• Quant Rating: Buy
• Sector: Utilities
• Industry: Electric Utilities
• Dividend Yield FWD: 2.92%

Unlike many industries that can become collateral damage in this AI-driven market, electricity remains one of the most indispensable commodities in the world. That’s precisely what makes American Electric Power Company a growth and income opportunity for investors looking for stability.

One of the largest electric utilities in the United States, AEP operates approximately 252,000 circuit miles of distribution lines and 25,000 megawatts (‘MW’) of regulated generating capacity. AEP runs the power grid across much of the Midwest and Central United States.

Strategically positioned in growth regions and focused on innovation, AEP’s diverse commercial and industrial footprint currently serves hyperscale customers such as Amazon (AMZN), Alphabet (GOOG) (GOOGL), Microsoft (MSFT), and Meta (META), creating a well-insulated accelerant for sustained growth and value. AEP gives investors the opportunity to gain safe exposure to the continued AI trend.

Q1 2026 earnings beat both top-line and bottom-line estimates, with management reaffirming 2026 EPS guidance of $6.15-$6.45 and outlining a $78B capital plan targeting 7%-9% earnings growth through 2030.

AEP earns a B Profitability Grade with the company’s growth driven by strong data center demand, fueling its exceptional margin performance across the board, led by a 16.29% Net Income Margin, which beats the sector median by about 31%.

In the midst of volatile market conditions, AEP has shown strong and consistent performance over the past year, earning itself an A- Momentum Grade. Headlined by its six-month price performance, which has more than doubled the sector’s median.

Dividend Grade Scorecard

AEP’s dividend profile is even more impressive, where it obtains a stellar A Safety Grade and an A Consistency Grade. The utilities company holds a 2.92% dividend yield and is backed by 36 consecutive years of dividend payments and 16 years of dividend growth.

As a Top Electric Utilities Stock, AEP offers defensive income with growth catalysts that are set to be sustainable and consistent.

2. The Hanover Insurance Group (THG)

• Market Capitalization: $7.04B
• Quant Rating: Strong Buy
• Sector: Financials
• Industry: Property and Casualty Insurance
• Dividend Yield FWD: 1.89%

Founded in 1852 and headquartered in Worcester, Mass., The Hanover Insurance Group provides property and casualty insurance products and services for individuals and businesses throughout the United States. The company operates through four segments: Core Commercial, Specialty, Personal Lines, and Other, offering coverage ranging from commercial automobile and workers’ compensation to homeowners and personal umbrella policies.

As a premier insurer, THG is insulated from most AI-driven drawdowns. Largely profiting on risk management necessities, THG’s business model is as consistent and reliable as they come. Led by its diversified portfolio, which has proven to be resilient across an inflationary environment, maintaining pricing dominance and improving margins as it passes the increase in prices onto consumers through rising premiums.

Hanover Insurance recently delivered exceptional Q1 2026 results, posting non-GAAP EPS of $5.25 – beating estimates by $1.03 – while revenue of $1.7 billion exceeded expectations by $120 million. Management signaled a full-year 2026 expense ratio of 30.3% following an impressive Q1 operating ROE of 20.3%. The company also approved a new $700 million share buyback program, demonstrating confidence in its operational trajectory.

THG is currently rated as a Strong Buy according to Seeking Alpha’s Quant System, backed by an outstanding combination of Factor Grades.

THG’s A+ Growth Grade stands out as particularly compelling, with 65.12% EPS diluted growth year-over-year. This exceptional earnings expansion reflects the company’s successful execution of underwriting discipline and operational efficiency initiatives.

The company’s A+ Revisions Factor Grade further reinforces the bullish outlook, with seven upward FY1 earnings revisions and zero downward revisions. This consensus optimism reflects Wall Street’s confidence in Hanover’s ability to sustain its improved profitability metrics.

Dividend Grade Scorecard

THG receives an A Dividend Safety Grade supported by its strong balance sheet and 21.75% return on common equity. With 19 consecutive years of dividend growth and a conservative 18.07% payout ratio, Hanover offers investors a high level of safety for a company with long-term EPS growth north of 100%.

Looking Ahead: Dividend Stability

The months ahead promise no shortage of continued turbulence in markets. With investor sentiment hyper-reactive to an endless stream of market-moving headlines, volatility is a near certainty with AI concentration, interest rate uncertainty, and mid term elections on the horizon. Surviving this chaotic market environment may require investors moving away from speculative noise and positioning into sustainable growth and income stocks. Stocks will likely continue to be put under pressure, whereas dividend stability may present the only off-ramp from AI-led market drawdowns.

If you are looking for a data-driven income strategy, explore our new Quant Growth & Income Portfolio – a systematic model built to outperform dividend ETFs by focusing on yield, growth, and safety. Seeking Alpha’s quant ratings and investment research tools help to ensure you are furnished with the best resources to make informed investment decisions while taking the emotion out of investing.

Could be traded as a safer anchor with high yielding ETF’s in your Snowball.

The Supreme Court Just Did Your Dividends a Favor (Wall Street Calls It a Loss)

Brett Owens, Chief Investment Strategist
Updated: June 24, 2026

The Supreme Court just ruled on our closed-end funds (CEFs).

Wait. What? Our beloved dividend machines, the lightly driven passenger payout cars we ride to comfy retirements? Our CEFs?

Yes, the third branch of the US government just spent its time deliberating a legal question about our humble, underfollowed CEFs. Why do the courts care about our underowned and unappreciated funds?

We love ‘em because they’re obscure. Underfollowed. And, best of all, inefficient.

Wall Street whales can’t jump into our profitable CEF pond. Most of these funds are $2 billion in market cap or less. If a whale cannonballed in, the entire sector would pop and the value would instantly disappear. No whale can stake a meaningful position.

A billion here or there in market cap is plenty liquid for us. So, we take advantage of generous CEF dividends (high single digits or better) and their dynamic discounts (5%, 10%, sometimes more)—which mean these funds regularly trade for 90 to 95 cents on the dollar.

It’s a contrarian value party for us! Thanks to these fish that are simply too small for the suits to fry.

But one player recently created a legal stir in CEF Land. And wouldn’t you know it, the case climbed all the way to the Supreme Court! It’s FS Credit, a purveyor of CEFs, versus Saba, an “industry activist.”

Saba—the activist—wanted more leverage over the funds. You may have run across Saba if you invest in CEFs. They pretend to ride to the rescue when a fund sells at a big discount.

Saba buys big stakes in CEFs when they’re trading at big discounts. It then uses the votes that come with its ownership stake to force the fund to buy back shares or even liquidate at full NAV. In other words, Saba buys shares big time so it can throw around its weight, close the discount quickly, and cash itself out.

The funds in the court case carry bylaws that strip the voting power of any holder above a 10% stake. These funds are specifically built to block that move. So Saba went to the courts—and the case was elevated all the way to the Supreme Court to rule on it. Saba sued, arguing that these bylaws break the Investment Company Act, a one-share, one-vote rule. On June 11, the court sided with the funds. It ruled, six to three, that Saba had no private right to sue here. Only the SEC can enforce the law—so Saba can’t use the courts for its own purposes to crack the funds’ defenses.

Now, note that the court didn’t explicitly bless the bylaws. It just told Saba it wasn’t allowed to raise the issue itself. What does this mean? Well, for us, these funds keep their protection—so Saba and other activist copycats lose their main lever: buying up stakes large enough to force whatever they want on these funds. This keeps the discounted CEF pond intact for us to fish for payouts and deals.

When Saba does pull off a full liquidation, it’s good for them but usually too bad for us dividend investors. We’re here for the payout, not the bonus pennies on the dollar that the activist may extract! Saba will move on to the next deal, like a house flipper. We income investors just want a reliable payout pillow we can rest our heads on! When the fund liquidates, the dividend dwelling is gone.

With each CEF that leaves the market via liquidation, we have fewer options when we shop for dividend deals. So, the SCOTUS ruling that limits Saba’s leverage over CEFs—its shortcut to liquidation—is a nice development for us.

Plus, there’s some irony! Saba masquerades like a CEF crusader whose mission is to eliminate any and every CEF discount. So let’s turn our attention to

the Saba Capital Income & Opportunities Fund (BRW), a CEF that always trades at a discount.

When Saba took over the fund in June 2021, BRW traded at a 2.3% discount to its net asset value. That’s 97.7 cents on the dollar. Today? The fund’s discount has ballooned to 12.3%. The discount coach can’t close its own window. HA!

And the real kicker? Saba doesn’t need to take anything over. It already runs BRW as the fund’s manager! Saba could easily close the discount window with a buyback, but it hasn’t bought back a single share.

Perhaps the Supreme Court ruling saved Saba from itself?

Anyway, what does this mean for us? Well, when we buy a CEF at a discount, we’re not waiting for the white knight Saba to ride in and close the window for us.

We buy funds where we don’t much care if the discount ever closes. We’re satisfied with the payouts we’re collecting, and we treat the discount as a margin of safety. Why pay a dollar for a dollar of assets when we can pay 95 cents? Or 90? Heck—sometimes we grab them for 88 cents on the dollar or better.

Right now, discounts in CEF Land are about normal. The average discount is 6%, or 94 cents on the dollar. Which, again, beats paying $1 for $1.

So, the bargains aren’t everywhere, but there are well-run funds trading at bigger discounts than the pack.

Our job is to find well-run funds trading below their historical averages. Sometimes, this means buying a fund at a premium when it’s a great fund and less than its “average premium!”

Counterintuitive, I know. But that’s what we contrarians live for. We walked through exactly that last week with 16.3% payer PDI (yes, you read right!) trading at a premium that is cheaper than usual:

Bottom line, we’ll keep doing our CEF homework and finding our own bargains. Six out of nine justices confirmed our strategy.

Statement regarding press speculation

The Board of Primary Health Properties plc (“PHP”) notes the recent press speculation regarding the potential formation of a joint venture in connection with PHP’s private hospital portfolio.

As previously announced, PHP has been exploring a range of strategic options to enhance the long-term value of the private hospital portfolio, including potential joint venture arrangements with highly credible investors.

PHP confirms that it is in advanced discussions with an investor regarding the potential contribution of the private hospital portfolio to seed a new joint venture.

Discussions remain ongoing, will be subject to all necessary approvals and there can be no certainty that any transaction will be agreed, nor as to the terms on which any transaction might be concluded. PHP continues to evaluate all options.

A further announcement will be made as and when appropriate.

SCHRODER EUROPEAN REAL ESTATE INVESTMENT TRUST PLC

(“SEREIT” or the “Company” and, together with its subsidiaries, the “Group”)

Proposed managed wind-down and return of capital to shareholders

The Board of Schroder European Real Estate Investment Trust plc and the Investment Manager, having assessed a variety of options for the Company, including mechanisms to address the persistent discount that the Company’s shares trade at relative to its Net Asset Value (the “Discount”), announces it intends to present formal proposals to shareholders for a managed wind-down of the Company.

The equity markets continue to disadvantage smaller, listed vehicles, especially sub £100 million market cap, irrespective of management quality or the suitability and effective delivery of strategies, with growing evidence that institutional investors want exposure to larger vehicles that offer enhanced liquidity, diversification and cost efficiencies. Despite offering shareholders unique access to a diversified portfolio of Continental European commercial real estate, delivering strong underlying property performance which has supported over £80 million of dividend payments since IPO, as well as maintaining a robust balance sheet, the Company’s size and low levels of liquidity have adversely affected the share price performance for a prolonged period of time.

The Board has actively explored various strategies, including share buybacks and a transition towards thematic or sector-specific investments. However, primarily as a result of continued macro uncertainty and the above-mentioned structural shift in investor sentiment towards larger UK real estate equities, it does not expect these strategies to significantly close the discount or support substantial long-term growth. In light of this, and following discussions with major shareholders, the Board, together with the Investment Manager, has concluded that it is in the best interests of shareholders to present formal proposals for a managed wind-down of the Company.

The Board and Investment Manager are of the opinion that the Company’s portfolio can be realised in the direct property market at a value in excess of what is currently implied by the prevailing share price.

The Board intends to publish a circular in due course to convene a general meeting, where it will seek shareholders’ approval through an ordinary resolution to modify the Company’s investment objective and policy necessary for a managed wind-down. Additionally, the Board and the Investment Manager have initiated discussions regarding the provision of investment management services during the wind-down, under revised terms aimed at better aligning the Investment Manager with the goal of maximising shareholder returns in a timely fashion. More details will be included in the Circular.

Should shareholder approval be granted, the Board will endeavour to realise all of the Company’s investments in a cost-effective manner, balancing the goal of maximising value from these investments with the timely return of capital to shareholders. Realisations may take the form of single asset or multi-asset disposals, with the proceeds used to repay borrowings and make timely returns of capital to shareholders.

The Company’s diversified portfolio totals 14 assets in high-growth locations across France, Germany and the Netherlands, which should underpin buyer interest, with the Investment Manager having the added benefit of leveraging the wider Schroders pan-European platform. Given the current market backdrop (as outlined in the Company’s most recently published Interim Report) and heightened geopolitical risks, the managed wind-down process is expected to take approximately two to three years to complete. This timing also allows us to execute targeted asset management initiatives to position the assets for sale and manage the French tax litigation.

Should shareholders vote to approve the managed wind-down, it is the Board’s current intention to continue paying dividends in order to maintain the Company’s investment trust status. The level of dividend payments will decline as the portfolio income reduces and as capital is returned to shareholders.