Shires Income Share Discussion Threads

[essentialinvestor] 25/8/2016 11:53

Latter, lots of info on their site.

They are both UK focused so a fair degree of share price correlation would
be expected imv.

[spectoacc] 25/8/2016 11:31

@EI - a little different to how I've described it, or a little different to MRCH? Agree with the latter. S/p chart comparison is interesting tho, move in lock-step more than I'd expect.

[essentialinvestor] 25/8/2016 10:11

Shrs looks a little different to me.

Found it helpful to listen to the full year audio cast on the Shires
Website, it details top 20 holdings, strategy etc.

[spectoacc] 25/8/2016 09:55

On the subject of MRCH - "sell" tip in IC last Friday, unusual for them to tip something like that as a sell. Main rationale was that it's a perma-underperformer, over-geared, and mainly that it's over-paying divis, so the capital value shrinks even as the divi stays high.

Hard to tell the MRCH & SHRS charts apart, but seems harsh to compare s/ps vs NAVs when discounts come into play. Still - they're pretty similar.

I maintain SHRS is the better punt - if you buy MRCH you've got GSK, RDSB, BP & HSBA as a top 4 making up fully 25% of the portfolio. Solid, defensive co's? Yes. Over-paying their fat divis? Probably, and on an earnings cover basis, definitely.

With SHRS, the top 4 are ASCI (wouldn't like to see them have to sell in a hurry, but then they don't have to. The usual double-fees argument, but ASCI I also have elsewhere - decent divi and fat discount of c.21%), then 3 bonds: Ecclesiastical, RSA, General Accident, total 23.2% of portfolio. The "dodgy ftse100 over-payers" are further down and at half the %s of MRCH.

So growth/income via ASCI, yield via bonds, equity/yield further down.

Final argument, even if assume they're both very similar: MRCH pays 5.65%, quarterly, on a 7.6% discount. SHRS slightly lower divi at 5.4%, but also qtly and on a 12.3% discount. Those discount levels should be the other way round if anything - MRCH is mostly equities, SHRS a large fixed interest component. (OK, can argue ASCI being the largest holding makes the discount more justified, but ASCI's on a fat discount itself already).

Apologies if a bit rambling/sounds like I'm trying to convince myself. Just been reviewing them and conclusion is "def hold".

[spectoacc] 22/7/2016 10:41

I'm a fan of these, having switched out of MRCH. Like the bond exposure of SHRS.

Likely to be in a super-low interest rate world for a long time. The gearing makes me a little cautious but no worse than MRCH & can argue it's gone into bonds not equities.

[essentialinvestor] 22/7/2016 10:37

Still a fat discount to NAV available here.

[essentialinvestor] 21/6/2016 16:08

deadly, in terms of the NAV discount re MRCH, MRCH very generally
will see greater NAV discount when trading at higher levels.
Yesterday the MRCH NAV was up over 4%, where SHRS was 2.5% approx.
Other factors also in play but that is how I look at it.

[whiskeyinthejar] 21/6/2016 13:02

It's quite UK focused. Exposed to commodities too I think.

So I think it'll react strongly one way or tother on Friday after referendum.

[deadly] 21/6/2016 12:09

I bought in last week at 193. Could have got a lower price and wish I had more now.
Looks to have been good timing.
The discount is just too good to miss.

[essentialinvestor] 15/6/2016 15:23

Apologies, need to clarify the earlier post, having listened to the
last half audio update today the financial sector exposure is less than it
first appears- it is one of the points addressed in the update.

Deleted my earlier post as a result.

[deadly] 15/6/2016 15:20

Financials are an area which could be considered oversold, even compared with the rest of the market.
In any case this is surely a good trust to own at these levels given its long track record.

[mozy123] 15/6/2016 12:36

Be a good trust to own if rate hikes actually happen. Financials will make greater spreads. Cant see it myself.

[deadly] 15/6/2016 10:30

Even better time to buy now they've fallen back again.
13% discount, 6.3% yield.
XD in 3 weeks time

[kiwi2007] 27/5/2016 11:30

"...The key reason for the underperformance during the year was the Company's exposure to the financial sector where it is overweight compared to our benchmark index, both through direct equity holdings and through the preference share portfolio. Standard Chartered was the worst performer due to disappointing trading, management change and a rights issue. Close Brothers, Schroders and Prudential also underperformed although, operationally, all three companies' results were satisfactory and their balance sheets are in good condition. Another negative area was the exposure to the mining sector, where BHP Billiton underperformed...."


Also there has been a general dumping of IT shares for the last few months (by those who know more than us?)..also SHRS is pretty small so only needs a couple of big sellers to move the discount down substantially.

Seems like a good time to buy a few?

[rcturner2] 12/4/2016 16:14

jds - those two trusts you mention are pure fixed income plays whereas this trust is 70% equity, so I would not call them similar. All sorts of different factors come into play with the discount, there is often no rhyme or reason to it. Blackrock for example have two quite similar trusts, BRWM and BRCI (world mining and commodity income) and they have had very different discounts at the same time.

[joy division still] 12/4/2016 15:28

RC T2
can you offer any reason why this is at a nice discount,but similar IPE and NCYF are at premium?

[rcturner2] 24/3/2016 17:35

bamboo, I would imagine the discount is mainly because this is a fairly small trust when compared to some of the bigger more well known ones. It seems to have maintained at around 5-10% most of the time.

The dividend looks safe to me, they are holding pretty normal large cap equities like most other income trusts. The only slightly different things I notice is that they have 27% of the NAV invested in fixed income (corporate bonds I assume) and 7% in a related trust (Aberdeen smaller co high income) which gives exposure to small cap growth and income.

[bamboo2] 24/3/2016 17:15

I'm unfamiliar with this IT.

It looks to be at a healthy discount. Is this anything to do with the gearing?

How safe is the dividend?

[rcturner2] 24/3/2016 09:48

I bought into this trust yesterday. Seems a very quiet thread!

[scottishfield] 19/9/2014 20:27

Good rebound today.

[scottishfield] 03/9/2014 16:37

Better day today, moving up now.

[scottishfield] 18/8/2014 11:52

good area to add imo.

[scottishfield] 17/6/2014 10:04

Yes, I see that it's an ADN trust, tks.

[plasybryn] 17/6/2014 10:02

The Chart looks good as well. Slight premium to NAV. Have a look at their Fact Sheet for more info on Aberdeen site.