A disciplined approach to long-term investing
In this video, Neil Hermon, Portfolio Manager of the Henderson Smaller Companies Investment Trust, provides an update on the Trust highlighting the key drivers behind the consistent level of outperformance, areas where he is finding opportunities, and the factors currently driving market uncertainty.
Key Takeaways
- The Henderson Smaller Companies Investment Trust has outperformed the benchmark in 16 of the last 18 years, driven by prudent stock selection and the teams disciplined approach to long-term investing.
- The increased number of initial public offerings (IPO’s) in the UK market has provided the team with attractive and exciting new investment opportunities.
- Higher inflation, the Covid-19 delta variant, supply chain disruptions, rising costs within raw materials, and labour shortages pose a risk to the market in the short to medium term.
- The Trust invests mainly in mid-to-small cap stocks; therefore, the increase in the Trust’s total assets to over £1bn has not impacted the team’s ability to find opportunities further down the cap scale.
The rate at which the prices of goods and services are rising in an economy. The CPI and RPI are two common measures. The opposite of deflation.
Initial public offerings (IPO) ExpandInitial public offering: when shares in a private company are offered to the public for the first time.
Related insights
These are the views of the author at the time of publication and may differ from the views of other individuals/teams at Janus Henderson Investors. Any securities, funds, sectors and indices mentioned within this article do not constitute or form part of any offer or solicitation to buy or sell them.
Past performance does not predict future returns. The value of an investment and the income from it can fall as well as rise and you may not get back the amount originally invested.
The information in this article does not qualify as an investment recommendation.
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Important information
Please read the following important information regarding funds related to this article.
- If a Company's portfolio is concentrated towards a particular country or geographical region, the investment carries greater risk than a portfolio diversified across more countries.
- Most of the investments in this portfolio are in smaller companies shares. They may be more difficult to buy and sell and their share price may fluctuate more than that of larger companies.
- This Company is suitable to be used as one component in several in a diversified investment portfolio. Investors should consider carefully the proportion of their portfolio invested into this Company.
- Active management techniques that have worked well in normal market conditions could prove ineffective or detrimental at other times.
- The Company could lose money if a counterparty with which it trades becomes unwilling or unable to meet its obligations to the Company.
- Shares can lose value rapidly, and typically involve higher risks than bonds or money market instruments. The value of your investment may fall as a result.
- The return on your investment is directly related to the prevailing market price of the Company's shares, which will trade at a varying discount (or premium) relative to the value of the underlying assets of the Company. As a result losses (or gains) may be higher or lower than those of the Company's assets.
- The Company may use gearing as part of its investment strategy. If the Company utilises its ability to gear, the profits and losses incured by the Company can be greater than those of a Company that does not use gearing.
- Derivatives use exposes the Company to risks different from, and potentially greater than, the risks associated with investing directly in securities and may therefore result in additional loss, which could be significantly greater than the cost of the derivative.
Specific risks