Abrdn Diversified Income... Share Discussion Threads

[davebowler] 12/12/2022 16:35

htTPs://www.aberdeendiversified.co.uk/en-gb/news-and-insights/insights/aberdeen-diversified-income-and-growth-trust-manager-update-video-nov-2022

[mister md] 28/10/2022 12:34

Finally dumped my holding in this at 90p yesterday - better opportunities elsewhere and already holding abrdn plc which is bad enough ;-)

[atlantic57] 14/10/2022 17:35

I suspect the market believes the net asset value is much less than stated which is why the shares are slipping.If 50% of their holdings are held in unlisted instruments these could really have taken a very heavy fall.

[wolstencroft] 14/10/2022 17:01

"The Company has a well-diversified portfolio, and has
proven to be resilient in the recent challenging
environment. While we expect market conditions to
remain challenging, we believe the Company is well
placed to continue to navigate what is proving to be a
difficult environment. We hope to be able to continue to
deliver differentiated returns to shareholders by holding
Private Market assets that are uncorrelated, or less
correlated to economic events, as well as listed assets that
can provide good cash flows, whilst also maintaining
exposure to certain assets that can participate to the
upside in more constructive market environments"

I wonder what they will say in their next report

[cc2014] 14/10/2022 15:43

Buying back all that debt which they were paying 6%+ on at crazy high prices hasn't turned out great...

The thing is the fund is so opaque. All this private equity markets only being revalued like once every 3 or 6 months gives no clue what the real NAV is.

[spectoacc] 14/10/2022 15:30

....Said everyone who's every owned it at any point ;)

Everything has a price tho - where's ADIG's?

[rich1952] 14/10/2022 15:28

This outfit needs winding up and the clowns who run it sacked.

[essentialinvestor] 14/10/2022 06:42

HP, it's been years of disappointment and not just in it's current incarnation.

Some of the comments here have been far too kind.

They have a mandate, look at their performance against that..

[atlantic57] 14/10/2022 06:31

Thanks for the constructive posts guys.I to am thinking of calling it a day I thought this would be a solid boring investment.

[cousinit] 08/10/2022 10:13

I guess a lot of the private market holdings are similar to what was being pushed towards pension schemes when they thought that they could have highly geared LDI positions and pick up illiquidity and risk premiums on the remaining capital. Will have to wait and see if there are secondary sellers (now BoE have insisted on lower leverage) but I suspect redemption notices will have already been submitted by a number of schemes for the first available window.

[speedsgh] 07/10/2022 15:20

There is a definition of Private Markets in their last annual report. AFAIUI all Private Markets Investments are unlisted.



The Company’s portfolio consists of investments from a wide range of asset classes including, but not limited to, Private Markets (such as private equity, private credit, real estate, infrastructure, natural resources and unlisted alternatives), Listed Alternatives (such as speciality finance, royalties, and listed Private Markets and alternatives), Listed Equities (including, global equities, European green infrastructure and UK mid-cap equities) and Fixed Income and Credit (such as global loans, asset backed lending, and emerging/frontier market debt).

--------------------

A full list of their Private Markets Investments as at 30/9/21 can be found on pg32-33 of the report. Perhaps unsurprisingly it includes a number of Aberdeen Standard funds!

[hugepants] 07/10/2022 15:04

It's not really the same as say chrysalis or supp though. And its mainly private markets not PE. There is a difference (not exactly sure what it is mind you!). The investments generally are income producing so can be valued to some extent based on that.
The discount is around 23% now and yield 6.2%. I expect they will writedown some of their property investments at some point though.

[spectoacc] 29/9/2022 06:59

"I'm looking to cut my stake by 50% around the 100p mark"

Hmm good luck with that. Agree with your point re base rates - can already get a 2 year fixed rate savings bond at 4.2%, and that will only rise.

Trouble with moving towards PE is that PE ITs trade at up to a 50% discount atm.

[wunderbar] 28/9/2022 17:50

I previously described ADIG as the rock of my portfolio given its low volatility in previous market turmoil. And up until mid-August it was doing what it is does best, plodding along in its usual boring fashion. Unfortunately it has succumbed to the latest market mayhem which has seen the stock plummet 6% in the space of a week and 8% over the month [sp closed at 90.8p, intraday low 88p]. The timing of this fall couldn’t have come at a worse time for ADIG’s management team noting financial year end is 30 September. In essence ADIG’s yearly performance has been derailed at the last minute and unless the share price rebounds sharply in next couple of days then results for 2022 will read as very poor, showing a share price decline of 9% over the year [vs 100p, y/e 2021], discount to NAV widening to over 20% [17.9%] and NAV falling to c.116p [122p].

Since portfolio manager Nalaka De Silva's investment strategy was implemented 18 months ago [c.98p] the share price has fallen 7%. Prior to recent falls the share price had spent most of the year bobbling between 98-101p, not really gaining any traction. The large discount to NAV continues to be a major problem despite buybacks. The board have stated they are targeting a discount of less than 5% [subject to normal market conditions] but this currently stands at over 20% [vs 12 month average 16.85%]. As for the NAV, there's been no sign of any growth in past 12 months which goes against the trust's objective. As ever I can’t complain re dividend income but I am getting increasingly impatient with the ongoing discount to NAV and general lack of growth in asset values.

On announcing his new strategy in Feb 2021, De Silva said “Private Equity/Market investments won’t yield/bring instant rewards, I’d expect these to start bringing in a generous income/return on equity within 3-5 years”. All being well these investments will start bearing fruit within the next couple of years, and in doing so should considerably narrow the steep discount to NAV. However, if there's no real progress come the end of his five year plan then both Nalaka De Silva and chairman Davina Walter will have a lot of explaining to do. Bottom line is both NAV and shareprice need to significantly improve or I'd expect heads to roll.

On a final note, this decline will be particularly frustrating for shareholders as we are now back to where we were almost two years ago. I topped up at 90p hoping the market sees sense in due course. Whilst ADIG is now my biggest holding I'm looking to cut my stake by 50% around the 100p mark. In fact I’m looking to divest 50% of my portfolio in the next 12-24 months simply as a de-risk measure. With the BOE base rate predicted to rise to 5.5% by next summer I suspect many investors will start moving funds into fixed rate savings offering returns equal to [if not better than] typical dividend yields [current FTSE100 average yield is 4.18%], all without the stress or worry of incurring significant capital losses as demonstrated by many stocks this year.

[krowelet] 14/9/2022 09:33

This does seem attractive to me in some respects for it's lack of volatility and yield in the present climate, though the large discount to NAV makes one wary. If this was to be wound up now at today's values what could shareholders expect to get back, would it be nearer NAV than the prevailing share price at the time? Any opinions welcomed.

[essentialinvestor] 01/8/2022 16:25

Spec, this was British Assets Trust back in the day, then went to Black Rock from memory, before Aberdeen.

[spectoacc] 01/8/2022 14:48

Thanks both.

Hoping for a more robust defence to get me in ;) But seems I'm not missing much.

@tiltonboy - agree re the 5% discount - and isn't as if they're over-geared. But then, if they bought back far more shares, that would be less money to punt on other ABRDN funds.

[tiltonboy] 01/8/2022 14:20

Specto,

A lack of value elsewhere, and the hope that there is some serious corporate action in the next 18 months is about as good as it gets.

I spoke at length a couple of years ago to the board, and was persuaded earlier this year to support a continuation.

The re-start of poxy, occasional buy-backs shows the board has lost the plot....and as for defending a 5% discount...I need say no more.

IMHO it is a gross dereliction of the board's duty in keeping this one where it is. The manager appears to have done a half-decent job, but it's time to fold it all up and pack it away.

[essentialinvestor] 01/8/2022 13:30

Spec, what are you getting here - a consistent record of failure to hit
frequently changed bench marks?.

The only case I could make for ADIG, is perhaps some outperformance
in market downturns which also pays a nice divi while holding.

NAV appears to be banging itself against a brick wall of late and
there has been little progress on that front for well over 12 months.

[spectoacc] 01/8/2022 13:20

I still can't get excited about ADIG.



1.76% ongoing charge (is that right? HL figs, Edison different), uncovered divi (but not by much). Looks the usual vehicle to direct more money into the manager's own funds (ABRDN, in this case, but they all do it - Schroders, Columbia, JPM etc), whilst trying to persuade you that you have "access" to their network/skill. Really? What, like the performance of ABDN's share price?

Opaque, less frequently valued things like property. A yield that looks great until RPIX hit 11.8% the other month.

Discount - that's the only thing that may draw me in.

@tiltonboy - persuade me! Their equity picks look mostly fairly safe. But other than discount, a bag over my head, and risk, what am I getting here?

Edit - Edison's p.6 peer group comparison rather painful, not sure I'd pit ADIG against the genuine wealth preservers like PNL, CGS, RICA. Strip out the two JPM's with short records, and they're bottom (6th of 6) over 3yrs, 5yrs, and 4th out of 6 over a year.



"The trust’s ongoing charges are lower than the peer average
and it does not charge a performance fee" - be interested to know why HL think it's far higher.

[davebowler] 01/8/2022 12:38

Same link but reviewed 18 July.

[riverman77] 21/6/2022 21:42

They don't really hold private equity, only a few per cent. The private funds are mainly infrastructure and real estate. These should have held up in the pretty well.

[hugepants] 21/6/2022 21:25

The NAV here has barely changed unlike the NAV of PE trusts which soared. What makes you think the value assigned to the private assets is not to be trusted?