Doceo discount watch

Discount Watch

Santa works his magic in London’s investment company sector once again. That is, if the more than halving in the number of funds trading at 52-week high discounts to net assets is anything to go by. Still, we estimate nine funds hit year-high discounts over the course of the week. No prizes for guessing which funds contributed the most names – alternatives of course.

By Frank Buhagiar•30 Dec, 2024

We estimate there to be nine investment companies that saw their share prices trade at 52-week high discounts to net assets over the course of the week ended Friday 27 December 2024 – 14 less than the previous week’s 23.

Last week, we highlighted that Santa appeared to be leaving it late this year if he was going to work his magic and trigger a seasonal rally in share prices across London’s investment company space. Well, one week on and, true to form, Santa has delivered, that is if the sharp drop in the number of investment companies trading at 52-week high discounts is anything to go by. Lesson learned. Never doubt Santa!

Turns out though, Santa’s magic was not enough to give the share prices of all funds a boost, particularly those belonging to the alternatives camp. Of the nine on the list this week, seven are alternatives: one from debt, two from property and four from renewables. Alternatives have featured regularly in the Discount Watch in recent weeks on concerns that higher bond yields may lead to higher discount rates which in turn could lead to lower valuations for the underlying assets held by alternative funds. Some investors clearly not waiting around to find out.

The top five

The full list