A successful October for BTEM saw its NAV grow by 3.5% with FX only playing a de minimis role. With the portfolio discount essentially unchanged at 25.2%, it was underlying NAV growth that drove returns in aggregate. Key contributors were Symphony International, Aker, Tokyo Broadcasting System, our Japanese Special Situations basket (previously referred to as “Net Cash”), Wendel, Pershing Square Holdings, Toyota Industries, and Tetragon Financial; in a month with few negative performers, Jardine Strategic’s widening discount meant it was our largest detractor (albeit costing only 9bps).

We wrote last month on Symphony’s declaration of a large special dividend that equated to a 12.4% yield on the undisturbed share price. The shares subsequently traded ex-dividend from early-October yet ended the month just 1.2% down despite the very sizable distribution.  In addition, largest holding Minor International (57% of NAV) recorded an increase in share price of over 6%.  The combination of a substantial return of capital at an effective zero discount, the discount narrowing almost 300bps to 24.8%, and NAV growth driven by Minor resulted in our position adding 61bps to BTEM’s NAV.  We attribute Symphony’s narrowing discount to a growing recognition that management are willing to return capital through a combination of buybacks and material dividends.

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AVI Global currently conducts its affairs so that its shares can be recommended by Independent Financial Advisers (“IFAs”) in the UK to ordinary retail investors in accordance with the Financial Conduct Authority (“FCA”) rules in relation to non-mainstream investment products and intends to continue to do so. The shares are excluded from the FCA’s restrictions which apply to non-mainstream investment products because they are shares in an authorised investment trust. © AVI Global Trust plc. 2019 Registered in England No: 00028203. An investment company under Section 833 of the Companies Act 2006. Registered Office: Beaufort House, 51 New North Road, Exeter, EX4 4EP. Managed by Asset Value Investors Ltd. which is authorised and regulated by the Financial Conduct Authority. Past performance should not be seen as an indication of future performance. The price of investments and the income may fall as well as rise and investors may not get back the full amount invested. AVI Global uses gearing techniques (leverage) which will exaggerate market movements both down and up which could mean sudden and large falls in market value. Please refer to the Key Features Document for further details of the risks affecting your investment. Performance figures are cumulative and based on Price total return and do not include Plan charges. For more information, please call 03458 500181. Tax treatment depends on the individual circumstances and may be subject to change in the future. Asset Value Investors Ltd do not offer Innovative Finance ISAs.


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