Seneca Global Income & Growth Trust
Finding opportunities following market weakness
28 May 2020
Seneca Global Income & Growth Trust (SIGT) is managed by a four-strong team at Seneca Investment Managers, seeking undervalued securities across multiple asset classes in order to diversify the trust’s risk and return drivers. Its UK equity portfolio was particularly negatively affected by the coronavirus-led market sell-off in March, given its focus on domestic, mid-cap value stocks, which performed relatively poorly. However, these holdings could stand SIGT in good stead during an economic recovery. The trust’s board has committed to continue paying quarterly dividends, using reserves where necessary if income falls short, which seems likely given the number of dividend cuts announced by corporates in response to the global pandemic. MORE »
Keeping a cool head in a tough market
19 March 2020
Seneca Global Income & Growth Trust (SIGT) has an overriding focus on value, which the team at Seneca Investment Managers believes offers compelling long-term investment opportunities. They employ a multi-asset approach in order to diversify the trust’s risk and its return drivers. While stock market volatility has spiked due to the coronavirus outbreak, SIGT’s managers are remaining calm. They are continuing to collect income and are topping up the trust’s positions that they consider are oversold. SIGT’s performance has lagged its inflation-based (CPI +6% pa) benchmark recently, but the managers are confident of outperformance over the course of the investment cycle. The trust’s structural bias to the UK and sterling should serve it well once there is increased clarity about the UK’s future relationship with the European Union. MORE »
Finding opportunities in a polarised market
26 November 2019
Seneca Global Income & Growth Trust (SIGT) has a multi-asset investment strategy, with an overriding focus on value. The team at Seneca Investment Managers aims to generate average total returns of at least CPI +6% pa over the course of a typical investment cycle. It believes that there is significant latent value within SIGT’s portfolio, and due to wide disparities in the market, there are opportunities to recycle capital. The managers are reducing exposure to positions that have done relatively well, while adding to long-term opportunities that are trading on very attractive valuations. The fund has a structural bias towards the UK and sterling, which should be beneficial for its performance if there is increased clarity surrounding the UK’s departure from the European Union. MORE »
Executive interview
21 November 2019
Seneca Global Income & Growth Trust (LSE:SIGT) was launched in 2005 and adopts a ‘multi-asset value investing’ approach, aiming to generate income and capital growth with low volatility by investing in a multi-asset portfolio of equities, fixed income and specialist assets. Since July 2017, SIGT’s performance has been benchmarked against CPI +6%. Annual dividends have increased each year since 2013. On 1 August 2016, SIGT adopted a discount control mechanism aiming to ensure that its share price trades very close to NAV. In this webcast, one of SIGT’s fund managers, Gary Moglione, discusses how the environment has been for value managers and how Brexit is affecting the fund’s UK exposure. He then highlights the new positions in the portfolio, before discussing changes within the specialist asset segment of the trust and how overall asset allocation has evolved over the course of this year. MORE »
Significant contribution from holding in AJ Bell
22 May 2019
Seneca Global Income & Growth Trust (SIGT) has a value-biased, multi-asset investment strategy. It aims to generate average total returns of at least CPI +6% pa over the course of a typical investment cycle. Recent performance has been significantly enhanced by the holding in financial platform AJ Bell, whose shares have nearly trebled since listing in December 2018. This has more than offset the negative effects from SIGT’s lack of exposure to US equities and safe-haven government bonds, which have performed relatively well. SIGT has a positive medium- and long-term track record versus its benchmark, despite growth rather than value stocks leading the markets in recent years. Performance has been helped by its c 30% exposure to specialist assets, which offer the potential for enhanced total returns, including high yields, supported by stable, inflation-linked income streams, along with lower volatility. MORE »
Further reductions in equity exposure
21 February 2019
Seneca Global Income & Growth Trust (SIGT) is a multi-asset, value investor, aiming to generate an average total return of at least CPI +6% pa (with low volatility) over the course of a typical investment cycle, while growing its dividend in real terms. In anticipation of a global recession in 2021, preceded in 2020 by pronounced stock market weakness, SIGT’s managers are continuing to reduce the trust’s equity exposure. Two new investments have recently been in specialist assets, a heterogeneous asset class, which diversifies the trust’s revenue stream and offers the potential for enhanced total returns and lower portfolio volatility. SIGT has a progressive dividend policy; its annual distribution has compounded by c 4% pa over the last five years, and the trust currently offers a prospective dividend yield of 3.9%. MORE »
Ongoing moves to a more defensive portfolio
26 October 2018
Seneca Global Income & Growth Trust (SIGT) aims to generate an average total return of at least CPI +6% pa, with low volatility, over the course of a typical business cycle. It also aims to grow its annual dividend at or above the rate of UK inflation. SIGT’s manager seeks undervalued investments across a range of asset classes. It also uses tactical asset allocation (TAA) in the context of a longer-term strategic asset allocation (SAA). SIGT’s investment team continues to find interesting opportunities, researching niche assets that other managers may be unable to consider. MORE »
Continuing to reduce equity exposure
3 July 2018
Seneca Global Income & Growth Trust (SIGT) aims to generate an average total return of at least CPI +6% pa, with low volatility, over the course of a normal business cycle, while growing annual dividends at least in line with UK inflation. It employs a value-based, multi-asset approach, investing in UK and overseas equities, fixed income and specialist assets. SIGT’s investment team employs a long-term strategic asset allocation (SAA), using a shorter-term tactical asset allocation (TAA), to take advantage of relative valuation differences between asset classes. In anticipation of an expected global economic downturn in 2020, SIGT’s managers are continuing to reduce risk by lowering equity exposure broadly at a rate of 1pp every couple of months. The TAA can vary markedly from the SAA when deemed appropriate, illustrated by the current zero exposure to North American equities. MORE »
Moving to a more defensive position
1 March 2018
Seneca Global Income & Growth Trust (SIGT) has a value-based, multi-asset investment policy, aiming to achieve an average annual return of at least CPI +6% over the course of a normal business cycle, and to grow the annual dividend at least in line with UK inflation. SIGT’s manager believes that active asset allocation can add value and can mitigate the effects of a stock market downturn. In anticipation of an expected global economic downturn in 2020, it has been reducing risk by gradually lowering equity exposure, while adding to specialist assets. The manager expects to continue to reduce the trust's equity position as the end of the bull market approaches. The shorter-term tactical asset allocation (TAA) to equities of 56% compares to the longer-term strategic asset allocation (SAA) of 60%. The trust has a positive investment track record; it has outperformed its blended benchmark over one, three and five years and since the change of investment mandate in January 2012. MORE »
Moving to a more defensive position
1 March 2018
Seneca Global Income & Growth Trust (SIGT) has a value-based, multi-asset investment policy, aiming to achieve an average annual return of at least CPI +6% over the course of a normal business cycle, and to grow the annual dividend at least in line with UK inflation. SIGT’s manager believes that active asset allocation can add value and can mitigate the effects of a stock market downturn. In anticipation of an expected global economic downturn in 2020, it has been reducing risk by gradually lowering equity exposure, while adding to specialist assets. The manager expects to continue to reduce the trust's equity position as the end of the bull market approaches. The shorter-term tactical asset allocation (TAA) to equities of 56% compares to the longer-term strategic asset allocation (SAA) of 60%. The trust has a positive investment track record; it has outperformed its blended benchmark over one, three and five years and since the change of investment mandate in January 2012. MORE »
Higher, more realistic benchmark introduced
25 October 2017
Seneca Global Income & Growth Trust (SIGT) has changed its benchmark to a more relevant CPI +6% rather than Libor +3%, aiming to achieve an average annual return of 6% above the rate of UK inflation over the course of a typical investment cycle. There has been no change to the investment process; SIGT seeks to generate long-term growth in capital and income, with low volatility of returns, from a portfolio of multiple asset classes. Anticipating a global economic downturn in 2020, SIGT is gradually reducing its equity exposure. At end-September 2017, its tactical asset allocation (TAA) was 59% to equities and 41% to other asset classes, including more than 25% to specialist assets, which generally yield 5-8%. SIGT aims to grow annual dividends at least in line with UK inflation (as achieved in each of the last four financial years). The trust has outperformed its blended benchmark and the FTSE All-Share index over one, three and five years and since its change of mandate in 2012. MORE »
More relevant benchmark proposed
27 June 2017
Seneca Global Income & Growth Trust (SIGT) has proposed changing its benchmark to a more relevant CPI +6% versus the current Libor +3%; it aims to generate income and long-term capital growth across multiple asset classes with low volatility. SIGT also aims to grow annual dividends at least in line with UK inflation. It currently has a long-term strategic allocation to equities (60%, split 35% and 25% between UK and overseas), fixed income (15%) and specialist assets (25%, generally yielding 5-8%). SIGT has outperformed its current benchmark and the FTSE All-Share index over three and five years and since its change of mandate in 2012, with lower volatility than the UK equity market. Annual dividends have increased above the level of UK inflation for the last four years and SIGT has regularly added to reserves. The board has been actively utilising the discount control mechanism that was initiated in 2016, with the aim that SIGT’s shares trade close to its NAV. MORE »
More than five years since mandate change
23 March 2017
Seneca Global Income & Growth Trust (SIGT) aims to generate income and long-term capital growth across multiple asset classes with low volatility. The trust adopts a long-term strategic asset allocation to equities (60%, split 35% to UK and 25% to overseas – with modest US exposure), fixed income (15%) and specialist assets (25%, generally yielding 5-8%). Shorter-term tactical asset allocations are made with a view to enhancing portfolio returns. For UK equity exposure, SIGT focuses on mid-cap companies, which over time tend to outperform the broader market. SIGT retains zero exposure to developed market government bonds, which the manager considers expensive. Following the change in mandate in 2012, SIGT’s NAV total return has outperformed the FTSE All-Share index, with significantly lower volatility; while dividends and reserves have grown every year. MORE »
Multi-asset investment with a value approach
29 November 2016
Seneca Global Income & Growth Trust (SIGT) aims to generate income and long-term capital growth from a range of asset classes. Investments are made for the long term using a strategic asset allocation to equities (60%: 35% UK and 25% overseas, with modest US exposure), fixed income (15%) and specialist assets (25%, including property and infrastructure assets, where yields can be in the 5-8% range). Around one-third of the fund is invested in UK mid-caps, where over time returns tend to be higher than for large-caps, and where the market is generally less efficient, providing opportunities for stock picking. There is no exposure to safe-haven government bonds, which the managers consider unattractively valued, and SIGT has lower FX exposure than its peers. Following a change in investment mandate in 2012, SIGT’s NAV total return has meaningfully outperformed the FTSE All-Share index, with significantly lower volatility. MORE »
Diverse income from multi-asset investment
15 June 2016
Seneca Global Income & Growth Trust (SIGT) is an actively managed, multi-asset global income fund. Investments are made in equities (strategic asset allocation of 60%), fixed income (15%) and specialist assets (25%) with the manager taking a long-term perspective. Since the investment mandate change in January 2012, SIGT’s NAV total return has significantly outperformed its benchmark three-month Libor +3% and its NAV has exhibited much lower volatility than the FTSE All-Share index. Dividends have increased each year since FY13; in the last two financial years the dividend was increased by 4.6% per year. SIGT’s prospective dividend yield is 4.2%. The board has announced its intention to introduce a discount control mechanism, which will commence on 1 August 2016. MORE »
Global multi-asset portfolio for income and growth
8 March 2016
Seneca Global Income & Growth Trust (SIGT) is an actively managed global income fund that follows a multi-asset value approach with a core allocation of 60% to equities, although this could range from 25-85% depending on market valuations. The trust’s NAV total return has outperformed its benchmark of three-month Libor +3% and the FTSE All-Share index over the four years since its investment mandate changed in January 2012. Volatility has been consistently lower than the peer group average. The prospective yield on SIGT is just over 4%. MORE »
Multi-asset investment for income and growth
1 July 2015
Seneca Global Income & Growth Trust (SIGT) is an actively managed closed-ended global income fund differentiated from the majority of peers by its multi-asset approach. SIGT’s NAV total return has outperformed its absolute benchmark as well as the FTSE All-Share index and the peer group average over one and three years and since its investment mandate change in January 2012, with significantly lower than average volatility. Paying quarterly, SIGT aims to pursue a progressive dividend policy and has a prospective 4% yield. MORE »
Income, growth and low volatility
4 December 2014
Seneca Global Income & Growth Trust (SIGT) is differentiated from its global equity income peers by its top-down multi-asset approach and absolute benchmark. The NAV return has been ahead of the benchmark since the mandate was changed in January 2012 and volatility has been significantly below the peer average over one and three years. The yield of over 4% is above the peer average. MORE »
