Doceo Discount Watch

Discount Watch

The number of funds trading at 52-week high discounts still in single digits, but what did new entry Diverse Income Trust announce two days after its discount set a new high for the year that will likely mean the fund won’t make it onto next week’s list?

ByFrank Buhagiar

We estimate six investment companies were trading at 12-month high discounts over the course of the week ended Friday 21 June 2024 – two less than the previous week’s eight.

Of the six funds on this week’s list, only one is a conventional equity-focused trust – Diverse Income (DIVI). The year-high discount of -10.37% was set on 18 June 2024. Chances are though the UK equity income trust won’t feature on next week’s Discount Watch List. That’s because two days later, DIVI announced it had agreed a lower fee structure with Premier Portfolio Managers. The fee cut appears to have done the trick – by close of play on Friday 21 June 2024, the discount had narrowed to -9.28%.

That means five alternatives account for the rest of the 52-week high discounters. Of these Aquila European Renewables (AERI) warrants a mention. For much of the week, the discount was hovering around the mid-20s. That all changed on 20 June 2024 when the company gave an update on itsongoing strategic review. Turns out, an offer for the company was received but not at a level that caught the eye. The Board is therefore continuing to assess all options and will look to provide a further update ahead of the upcoming continuation vote that is due to be held in September 2024. The lack of any meaningful news perhaps the reason why the discount widened to -31.55%.

The top-five discounters

The full list