View more on these topics

Aberdeen suspends two more split-cap trusts

Aberdeen Asset Management has suspended two more of its split-cap investment trusts, leaving investors unlikely to see any ret-urn on their money.

The boards of Aberdeen&#39s high-income trust and leveraged income fund suspended trading last week.

The news comes only a week after its media & income trust was put into liquidation.

Seven splits from across the industry have now been suspended or liquidated since the split-cap crisis started.

Aberdeen insists its trusts have run into difficulty because of the gearing and bank debt they are exposed to and not because of the cross-holdings in other splits.

But some IFAs say it is convenient for managers to blame their creditors when it has been poor management which is responsible.

Aberdeen managing director Gary Marshall says: “Suspension means there is uncertainty about the financial liquidity of the companies. The moves could resort to a restructuring of some kind. Media & income only had very small cross-holdings while the other two are fund of funds which means crossholdings are fundamental.”

Simpsons of Brighton partner Andrew Merricks says: “Not all split-caps are bad investments but the industry has been given a bad name by the likes of Aberdeen. It is all very well blaming the gearing but if you are a professional manager, you cannot blame the bank and the borrowing.”

Recommended

Bristol & West – Escalator Bond

Monday, July 22, 2002Type: High interest accountMinimum-maximum investment: £1,000-£1mInterest rates: Annual interest 4.5% gross a year in year one, 4.8% inyear two, 5.75% in year three. Monthly interest 4.4% gross a year inyear one, 4.7% in year two, 5.6% in year threeTerm: Three yearsOffer period: Until further noticeWithdrawal penalties: No withdrawals permitted during termTel: 0808 […]

Keydata bond gives protection choice

Keydata Investment Services has introduced a fifth issue of secure growth portfolio, a guaranteed equity bond that has a five-year term, linked to six funds.The HSBC UK growth & income, New Star UK growth and Investec European funds carry the highest weighting, each comprising 20 per cent of the portfolio. Threadneedle American select growth and […]

Talkback

“Yes. Maybe there ought to be changes to the rules, bearing in mind what has gone on. There is perhaps too much investing in each others&#39 trusts.”Alastair Cameron, The Cameron Consultancy“Yes. I think the general public is not that aware of how investment trusts work and some people may take advantage.”Richard Peasley, Churchill Securities & […]

NU makes emergency cuts

Norwich Union is devaluing all with-profits policies by 5 per cent and slashing bonuses in an emergency measure blamed on falling stockmarkets.The changes, which take effect from August 1, mean terminal bonuses will be cut by whatever amount necessary to meet the 5 per cent overall cut. Some terminal bonuses will be wiped out altogether. […]

Neptune launches Japan Institutional Fund

By Chris Taylor, Investment Director, Head of Research Neptune is excited to announce the launch of the Japan Institutional Fund on 22 June, having disclosed to the market in March its intention to offer the product. The Fund will be managed by the highly-regarded Chris Taylor, Head of Research and manager of the long-running Japan Opportunities Fund. It will invest in the same underlying stocks as the Japan […]

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment