* As at 31 August 2023
** Source: Morningstar, performance period 30 June 1985 to 31 August 2023, TR net of fees, GBP
*** As at 30 September 2020, includes: management fee 0.70%, marketing and administration costs
If you’re not familiar with us, here’s a video that’ll help. This video is presented by Joe Bauernfreund, CEO and Chief Investment Officer at Asset Value Investors.
AVI Global Trust (“AGT”) provides expertly managed exposure to the opportunities presented in various parts of the world. The investment strategy identifies valuation anomalies to create a concentrated, unique and diversified portfolio of stocks. The investment manager then engages with these companies to improve shareholder value.
|Label||2022 %||2021 %|
|< £1 billion||29||25|
|> £1 billion - < £5 billion||30||28|
|> £5 billion - < £10 billion||11||11|
|> £10 billion||30||36|
|Label||2022 %||2021 %|
|Asset-backed Special Situations||21||30|
|31/08/2023||% of NAV|
|Schibsted ASA ‘B’||7.9%|
|Oakley Capital Investments||7.8%|
|Princess Private Equity||6.4%|
|Pershing Square Holdings||4.3%|
The AVI Global Trust plc (“AGT”) was established in 1889 in order to generate profits for its shareholders by investing in the shares of other companies. In 1985, Asset Value Investors (“AVI”) were appointed as investment managers of AGT, which at that point held a total of £6 million in assets under management. As at 31 August 2020, total assets under management of AGT stand at over £979 million.
Asset Value Investors (“AVI”) value investment process for AVI Global emphasizes bottom up fundamental research, using both quantitative and qualitative techniques.
AVI’s screening process starts by looking at an investment universe which consists of global holding companies, closed-end funds and asset backed companies. We have detailed models on approximately 415 companies out of this universe, which track stock prices and earnings information.
Throughout the filtering process AVI asks the following questions:
AVI’s analysts track stock prices, earnings and balance sheet information with an aim to identify good quality companies trading on a discount to their NAV which exhibit clear trends to create long-term value.
We want to have a reasonably concentrated portfolio (typically 30-40 stocks) of our best ideas
The objective of AVI’s portfolio construction process is to end up with a concentrated portfolio of about 40-50 holdings, facilitating a clear monitoring process of the entire portfolio. AVI picks stocks that meet our investment criteria and once we decide to invest we seek a minimum position size of approximately 2% of the portfolio, however the timing of the catalyst and the liquidity of the stock can result in the holding being greater or lesser than 2%.
The investment philosophy employed by Asset Value Investors (“AVI”), the managers of AVI Global, strives to identify valuation anomalies and focuses on investing where the market price does not reflect the estimated intrinsic value.
Asset Value Investors (“AVI”) deep value investment process strives to identify and mitigate downside risks in all market environments.
We seek to construct a discounted portfolio of stocks consisting of companies which due to the geographic and sector diversification of their underlying assets are less likely to display high correlations to the market.
AVI’s risk management techniques include thorough qualitative fundamental bottom up research to establish a company’s real value. We monitor our holdings on an on-going basis and our in-house OMS system contains an automatic alert system which alerts us of any breaches of built-in risk parameters.
The investment management team holds regular meetings discussing the portfolio with a view to reassess, sell or buy securities and to discuss current cash position as well as sector and geographic weighting.
Exclusionary screening is not our guiding framework, however there are certain exceptions to this. AVI will not invest in a company with direct involvement* in:
Or companies that engage in child labour or human exploitation as defined by the relevant ILO conventions.
* whereby more than 5% of that company’s NAV is derived from these activities.
As part of our in-depth research into companies, we consider and discuss material ESG risks and opportunities, including climate-related risks and opportunities. Supported by ISS Norms-based research, we also assess any involvement in actual or potential violations of international norms and standards.
We have developed a bespoke ESG monitoring system built into our proprietary database to ensure ESG factors are considered alongside financial analysis. We conduct ongoing ESG assessments of portfolio companies’ performance against defined ESG metrics. A scoring system is used to assess trends and highlight potential areas for engagement.
Based on our assessments, we send tailored questionnaires to all portfolio companies to request additional ESG information and promote improved sustainability disclosure. This can provide a useful starting point for deeper engagement on ESG issues.
Controversies can bring major reputational damage and a loss of consumer trust which can have a significant effect on a company’s value. We promote responsible conduct by actively engaging and encouraging our companies to strengthen their focus on ESG issues.
We seek to build constructive relationships with the boards and management of our portfolio companies, offering detailed suggestions to sustainably increase corporate value by building resilience to ESG risks and promoting responsible business practices.
AVI Global Trust plc (“AVI Global”) is a closed-end investment trust with shares listed on the London Stock Exchange and part of the FTSE 250 index. Shares in AVI Global can be bought directly on the London Stock Exchange or through the following platforms:
There are two ways that the value of a share in an investment trust is often expressed:
It’s the role of the asset management company, AVI ,appointed by AVI Global to plan, manage the assets and oversee the investments on behalf of investment trust.
AGT’s index agnostic approach allows for investments to be made in areas of the market that are often overlooked by other funds, typically due to their unconventional structures, size, or liquidity. These areas can include listed family holding companies and private equity, which over time, have been shown to deliver excess returns.
AGT’s unique approach of investing in holding companies, closed-ended funds and asset-backed special situations differentiates us from other funds, with portfolio holdings unlikely to be found elsewhere. Through these unconventional structures, AGT gains exposure to multiple underlying companies, providing both sector and geographic diversification benefits.
Track Record of Outperformance
Through an unconstrained and unique investment philosophy, AGT has been able to outperform its comparator benchmark over the long run. Since 1985, AGT’s average annual performance has been 11.5% vs 9.0% for the benchmark
(View chart below) Over the past ten years, the ordinary dividends paid by AGT to shareholders have grown by more than 6.5 times. The level of income may vary due to the occasional receipt of large, one-off, special dividends from investee companies and it is for this reason that AGT has paid special dividends in the past few years. Naturally, there can be no guarantee that further special dividends will be paid in the future.
* as at 30 September 2022.
They are quoted companies listed on the London Stock Exchange with Boards of Directors; they are subject to the listing rules of the UK Listing Authority established under the Financial Services and Markets Act. ‘Investment Trusts’ are also subject to the Companies Act 1985, as amended. The conduct of investment managers in promoting packaged products (‘ISA’, Share Plans) with underlying investment trust investments are regulated by the FCA.
Investment trusts can borrow money and invest the proceeds. This will magnify returns to investors in a rising market (and vice versa in falling markets). This is known as financial gearing. Typically the ‘gearing’ is described as a ratio (of borrowing to assets) – a gearing factor of 120 means that on a trust with equity of £100 million it has £20 million of debt (bank borrowings).
Typically anything from 50 to 100 shares. The ‘Fund Manager’ must have regard to the objective of the trust. To that end the underlying stocks are bought or sold to deliver either capital growth or income. Within those portfolios the managers will assess the stocks on a regular basis to ensure that they will deliver the objective, hopefully selling in advance of profit warnings or any other adverse market change that could impact on either the ability to deliver income or capital appreciation. Sometimes that can’t be achieved; that’s why ‘investment trusts’ have a spread of investments.
The spread is set by the marketmakers. There is no standard spread, it depends on the ‘liquidity’ of a particular stock, but in the case of AVI Global the average spread is 0.22% *. It does not include stamp duty which is a tax at 0.5% of the value of all share purchases.
* as at 28th February 2015
The dividend yield is the last 12 months dividends (historic) divided by the share price.
All are calculated with reference to the previous closing mid price.
The company secretary has the responsibility for co-ordinating all aspects of the investment trust to ensure that it complies with its legal and financial reporting including any circulars etc., report and accounts, interim reports; convening board meetings, minutes and follow up there from, as well as liaison with the Board and external advisers.
The Board is responsible to shareholders; it oversees the external relationships, principally the fund management relationship, to ensure that the trust’s objective is met.
Under the Companies Act all public companies must maintain a register of their shareholders to record title to the security; to determine entitlement to dividends or capital distributions.