Some Investment Trusts have wide spreads (buy/sell price), especially first thing in the trading day. It’s very important that u check the spread before u trade.

U can often trade within the spread but many platforms allow u to make dummy bids and u can see if u want to buy/sell or wait and see if the spread narrows.

ABRDN DIVERSIFIED INCOME AND GROWTH PLC

REDEMPTION AND CANCELLATION OF 6.25 PER CENT BONDS DUE 2031

Bond Redemption

The Board of abrdn Diversified Income and Growth plc (the “Company“) hereby announces that, following the agreement of shareholders to the proposal to put the Company into managed wind-down, the Company redeemed and cancelled the remaining £16,096,000 in aggregate principal amount of its 6.25% Bonds due 2031 (ISIN XS0134340180) (the “Bonds”) on 9 April 2024.

As announced on 8 March 2024, the redemption price was 114.983%. The redemption price having been calculated in accordance with the conditions, using the gross redemption yield of the United Kingdom 6% Treasury Stock due 7 December 2028.

Application has been made for the admission of £16,096,000 in principal amount of the Bonds to the Official List of the United Kingdom Listing Authority to be cancelled in accordance with the FCA’s Listing Rules.  Following this redemption and cancellation there remain no further Bonds outstanding and the Company has no further debt.

Expected circular and approvals

The Company has commenced the process required for Court approval for the shareholder approved reduction in the nominal value of the Company’s ordinary shares from 25 pence per ordinary share to one penny per ordinary share (the “Capital Reduction“) and cancellation of the entire amount standing to the credit of the Company’s capital redemption reserve (the “Capital Redemption Cancellation“) and share premium account to create distributable reserves which may be applied in any manner permitted by the Companies Act and/or the Company’s  articles of association (including for any bonus share issues and/or redemptions, tender offers, share buy backs and/or other returns of capital) excluding (in respect of the Capital Reduction and Capital Redemption Cancellation) the payment of dividends.

The Company also expects in the coming weeks to issue a further circular providing details of the expected initial capital return, which is proposed to be carried out by way of an issue and redemption of bonus shares to all shareholders (the “B Share Scheme“), including a summary of the UK taxation consequences for shareholders.  The circular will convene a general meeting to seek the further shareholder approvals required to be granted for the implementation of the B Share Scheme.  Subject to these further shareholder approvals being granted and the required Court approvals being received, it is expected that the initial return of capital will be implemented around the end of June 2024.

££££££££££££££

Current discount to NAV 31%. A strong hold as we await developments.

U want to start investing but do not now where to start as u don’t want to lose your hard earned.

One option is a World Wide Tracker, VWRL is the working example but there are others to choose from.

Bull points.

As long as u can choose when to sell, u will not lose your money.

Modest dividend for re-investment.

Multi years when the share price is flat lining, which is a plus if u want to add funds as they are available.

Bear points.

No reserves so the dividend is variable.

The modest dividend is not the main reason to buy the ETF

ETF’s trade around their NAV so no discounts to NAV.

Multi years when the share price is flatlining, so like watching paint dry.

Once u have made a capital gain, u could sell the position and re-invest in the Snowball or take out the profit to do the same. Or buyback the shares u sold higher up and do it all over again. Remember a profit is not a profit until it sits in your account as cash.

I must emphasise that it’s likely after u buy, especially after a strong rise in the price, that u will lose money. So only money u don’t need and when u can choose when to sell.

Should u buy before the xd date, where u can then choose where to re-invest your dividends. Or after the xd date where u should get more shares for your money and in the long run more dividends for your hard earned ?

The Motley Fool

£4,000 of savings, here’s how I’d aim to turn that into passive income of £300 a month

Story by Charlie Carman

Some investors prefer to earn passive income today. Others opt to defer gratification. They focus instead on capital appreciation by buying growth stocks and reinvesting dividends from income shares for greater rewards down the line.

There’s no right answer to which is the right approach. That depends on each individual investor’s financial objectives and time horizon.
However, I’m a firm believer in the merits of long-term investing. So, if I had £4k to invest, I’d focus on rewarding my future self by targeting a £300 monthly passive income stream in later life. Here’s how.

A neat ISA trick
First, it’s important to consider which investment vehicle I’d select. Since I plan to hold my stocks for many years, a Lifetime ISA might be an attractive option.
I could maximise my permitted contributions in a single tax year by investing £4k in a Lifetime ISA. Subsequently, I’d receive a generous 25% government top-up on my portfolio. Accordingly, I’d have a total of £5k to invest in the stock market.

Granted, there are withdrawal restrictions if I take the money out before I reach the age of 60 and I’m not buying my first home. However, with long-term passive income goals in mind, I’d try to avoid incurring any penalties insofar as possible.


Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice. Readers are responsible for carrying out their own due diligence and for obtaining professional advice before making any investment decisions.

Going for growth
At the outset of my investing journey, I’d prioritise capital growth over passive income. By taking on more risk in the earlier years, I’d hope to build a larger portfolio that could provide me with larger dividend payouts in retirement.

For context, the FTSE 100 index has historically returned around 7% annually since its inception. I’d aim to beat this with a high-growth investment strategy.

For instance, if I invested £5k at the age of 30, I could have a portfolio worth over £90k by the time I reach 60 with a 10.12% compound annual growth rate.

At a 4% yield, my holdings would generate my desired target of £300 in monthly passive income.

But, is a high-growth strategy risky?

Unfortunately, there are no guarantees when it comes to investing in individual shares — and often growth stocks carry significant risks as well as potential rewards. In addition, concentrating a portfolio in just a few shares would be less diversified than a tracker fund.

However, some options investors could consider include Scottish Mortgage Investment Trust — a growth-oriented fund that invests globally in public and private companies — or pharma giant AstraZeneca, which has been a top-performing FTSE 100 stock in recent years.

Rebalancing for passive income
As retirement approaches, I’d rebalance my portfolio away from growth and towards income. Therefore, a greater number of defensive investments, such as Dividend Aristocrats with reliable track records of delivering passive income, would feature in my portfolio.

Some defensive dividend stocks for investors to consider today might include cigarette colossus British American Tobacco, consumer goods conglomerate Unilever, or alcoholic drinks titan Diageo.

Of course, no shareholder distributions are guaranteed. If dividend cuts reduced my portfolio’s yield, I’d need to invest more to compensate for the loss of passive income.

Nonetheless, with a strategy of pursuing growth first and income later, I reckon I’d stand a good chance of generating a solid lifelong second income starting with just £4k.

The clue is in the title why it was a Trust to buy.

415p to buy dividend 26p yield 6.2% trading around NAV.

If u had bought around the low and simply re-invested the dividends u would have doubled your money.

U could have taken out your stake and re-invested in another high yielder and achieved the holy grail of investing a Trust in your portfolio that sits in the account at zero, zilch, nothing and produces income to add to the Snowball.

So what made it a buy ?

IPS Highlights

·	The Company’s wholly-owned provider of professional services is a key differentiator to other investment trusts and offers additional portfolio flexibility.
·	Accounts for c.20% of 2023 NAV, but has funded approximately 34% of dividends paid by the Company in the last 10 years.
·	IPS has now delivered six consecutive years of growth, with a 5 year net PBT CAGR of c.8.7%.
·	2023 valuation of £185 million (excluding net assets) up 111.4% since 2018.

Longer-Term Record

·	135 years of history.
·	Long-term record of valuation creation for shareholders.
·	113% aggregate increase in the dividend over the last 10 years (7.9% CAGR).
·	45 years of increasing or maintaining dividends to shareholders.

Robert Hingley, Chairman, said:

“Law Debenture made creditable overall progress in 2023. The share price total return of around 8% includes a further good increase in our full-year total dividend of 4.9%. Law Debenture’s long-term record of benchmark outperformance remains strong.”

“We remain confident that, in the long term, the combination of a robust and well-positioned equity portfolio and continued growth in our IPS business will deliver attractive returns for our shareholders.”

Current yield 4% so wait for the next market crash ?

Market Beat

The stock market has always been unpredictable, but unprecedented world events have made the market even more unpredictable during the last few years. Between the end of the 10-year bull run, the COVID-19 pandemic, unprecedented fiscal stimulus, wars overseas, and rising inflation, the idea of a normal market environment has all but disappeared.

The only thing that we can do is look at historical averages to see where today’s market fits in the grand scheme of things. The DOW is still trading over 30,000 and S&P 500 companies are trading at nearly 21 times their annual earnings, well above the historical average of 15 times earnings.

At the same time, we find ourselves in a rapidly changing interest rate environment. Fixed income investments have increased in yield in the last few years, but it’s hard to predict how long the Federal Reserve will keep rates elevated for. S&P 500 stocks continue to yield under 2% and some investors think it’s too challenging to find safe and affordable securities that pay 4%, 5%, and even 6% yields.

Searching for yield isn’t easy in an environment where historically high asset prices and stimulus from the Fed have driven down yields. This doesn’t leave many options for investors looking for retirement income or a decent dividend yield on their stocks, but there are a handful of cheap dividend stocks to buy that are still yielding 3%-6%.

3 steps to earning £100s in monthly passive income

The Motley Fool

Story by Paul Summers

Forget side hustles or buy-to-let property (both of which actually require a lot of puff and bother), I reckon the stock market is one of the few places for generating true passive income.

It’s not hard to get started either.

Step 1: Save…anything
Naturally, it’s necessary to have some money to invest in the first place. However, I’d wager that this is a lot less than most people think.

Setting aside £25 a week is a great start but, frankly, anything is better than nothing. I go as far as to say that the first step to earning a solid passive income from the stock market is achieved in the brain. It’s about accepting that the process is a marathon rather than a sprint.

What’s more, there are little ways of making this money go further. For example, taking advantage of a broker’s regular investing service drives down commission costs. Some platforms don’t charge anything at all.

Step 2: Seek out resilient dividend stocks
Having saved a small amount, it’s time to start buying.

But wait! I wouldn’t just snap up the first company that springs to mind.

Some appear to be offering monster dividend yields when, in reality, all that’s happened is that their share price has fallen (a company’s valuation and dividend yield are negatively correlated). This suggests the business is going through a ‘sticky patch’ or worse.

Guess what’s usually the first thing to be cut in such a situation?

This is why I generally look for companies that provide a service or products where demand tends to be fairly resilient.

For example, we all need food and drink and access to electricity. We also get sick occasionally. So, owning shares in firms like Tesco, National Grid, and GSK would make sense to me.
Nevertheless, no dividend stream can be guaranteed. For evidence of this, even some of the most ‘reliable’ stocks slashed their payouts during the early days of the pandemic.

However, having relatively stable earnings usually makes it quicker to recover from setbacks.

Of course, stock picking isn’t for everyone. So, an alternative for newbies is to buy an exchange-traded fund that tracks the FTSE 100 index. This means I’d own a minuscule part of each of the UK’s 100 biggest companies.

Spreading my money around in this way ensures I don’t need to worry when individual companies share prices yo-yo about. This safety-in-numbers approach also makes the dividends I receive from the fund even safer.

Step 3: Consistency is key
Once purchased via a broker (ideally in a tax-efficient Stocks and Shares ISA), the only thing left to do is sit back and wait for the passive income to arrive.

Most companies that pay dividends tend to divvy out the cash twice every year. However, some pay every three months.
Initially, we’re probably talking pennies rather than pounds. That’s fine – I can keep adding to my stocks when money becomes available. The more shares I own, the more in dividends I should receive. I can help things along by reinvesting whatever is received back into the market.

So, while generating hundreds of pounds a month in passive income from the stock market might seem impossible to begin with, it’s anything but.

Just add commitment and time.

Chucko is a very knowledgeable investor and as the current yield is 15% even when they start to cut their dividend there is plenty of room to keep above the desired 7% yield, so a strong portfolio hold as the position develops. Plus the cash returned can be re-invested in the Snowball.

chucko19 Apr ’24

Well, I am scratching my head a little! The leverage is stated as 0.27x in October and 0.15 x as of “now”. The October update states the leverage as 0.25x then, and the January 2024 update cites 0.10x. So I cannot determine the definition they are employing for this release.

Anyway, 5.12% of the 83.18p January NAV is 4.2588pps, and although that may appear to be small beer for a capital return, they have repaid half the debt (gearing facilities) and so we are likely to see some higher repayments in due course. From a value perspective, I am interested to observe the fall in SP upon this going ex-cap, and whether the theoretical increase in discount were the sp to fall by 4.25p offset by value investors (like myself) or ignored by those with more pressing concerns about whether or not to continue holding a liquidating IT.

Much more to travel on this one.