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| Share Name | Share Symbol | Market | Stock Type |
|---|---|---|---|
| Cqs New City High Yield Fund Limited | NCYF | London | Ordinary Share |
| Price Change | Price Change % | Share Price | Last Trade
|
|
|---|---|---|---|---|
| -0.20 | -0.38% | 52.40 | 08:10:00 |
| Open Price | Low Price | High Price | Close Price | Previous Close |
|---|---|---|---|---|
| 52.40 | 52.40 | 52.40 | 52.60 |
| Top Posts |
|---|
Posted at 04/7/2023 08:02 by giltedge1 Thanks CC2014, for detailed analysis hold off for now if goes to a 10% discount may consider, I think UK investors are swayed by yield, not total return. For example many successful companies make 20% returns on capital, but pay no dividend. UK investors like cash dividends. |
Posted at 21/6/2022 10:38 by cc2014 "If holding a fixed interest stock long term the share price may go down, which reduces the NAV of a fund such as NCYF, but the income continues."Well, yes, no, sort of but not really. I understand what you are saying and I see your point but: 1. Recently the value of RAVP went to zero. RAVP has been delisted and there may be some debate about future dividends but right now it's zero. The total capital of around 3% of the fund has been wiped out, or very nearly wiped out depending on your view of Russia. There is no longer an income stream and this is part of the risk with investing in high risk/high yield funds like NCYF. 2. The prefs you mention do not have maturity dates so they will drift up and down depending on interest rates and the health of the underlying company. Whilst the Aviva prefs give a yield of around 7% at 120p it's no good if they drift down to 100p and then Aviva redeem them as they won't be regulatory capital in 2024. Again the capital would be reduced and the income doesn't continue. I could run the argument another way though. Please allow me some breath over the exact details here but let me run with the broad outline. Over the last 20 years since the fund was started the share price has halved from 100p to 50p because the fund manager has made a few bad investments but more validly every year he is paying out more dividends than the value generated within the fund. If in another 20 years time the share price has halved again to 25p will the fund still be paying 4.5p dividends? Of course if interest rates rise to 2.5% the fund manager has a far better chance of making enough to pay the dividends. That looks far more feasable going forward. Look, I'll try and given you my overall view. The fund has a dividend of around 8.5% but it loses around 2.5% a year in capital on average. If you own it in the knowledge it's making around 6.0% in the long term that's fine. I've owned NCYF in the past myself when I've been farily sure interest rates were in my favour. Since I take the view the return is about 6% a year, then there are lots of other investments yielding similar that don't seem to carry the same risk. The market is entitled to price NCYF at whatever it likes but my guess is that the price is being held up by investors who are focussed on the yield but haven't fully considered the likely capital losses. The overall problem though is that it loses alot when the economy is under stress through bad investments. I'm anxious we are heading that way right now as the consumer is under pressure through inflation. A little bit of inflation is good for bank debt as the banks improve their NIM. A lot of inflation is very bad indeed as consumers start struggling to pay their debts. |
Posted at 17/6/2022 14:07 by cc2014 NAV smashed yesterday and breaches 50p. Now 49.63pStill NCYF trundles along at a 8% premium to NAV despite the capital losses to investors. |
Posted at 28/4/2022 12:51 by guitarsolo Marktime/Retirement:Just to add a little of what I know, the last published figures were poor with EPS of 4.18p (down from 4.59 the year before) and indeed it left the 4.47pps dividend uncovered. This required them to dip into the reserves which stood at 4.15pps at the end of the same period. Just looking at these numbers would cause justified concern. But there was a bit of narrative that was relevant. The covering info stated that the 4.18pps EPS was low because two particular coupons had been missed (for Rea Holdings and Matalan). I can't tell you exactly how much they were or how much of the gap up to the dividend would have been covered had they been paid on time. But more importantly, I have it on good authority from a reliable investor who holds the Rea coupon elsewhere that it WAS paid, albeit after the accounting period. I'd imagine the Matalan coupon is similar. Therefore, the picture may not be as bleak as first thought. I've held NCYF for ages and am down on capital but the dividends take me into profit. Ian Francis has very deliberately (in my view) increased the dividend every year (by 0.01p recently) just so that (in my view!) he can claim to have a record of always increasing dividends! Of course, taking inflation into account and it's a real term drop. But reading IF's narratives over the years, the ultra-low interest rate environment has been a horror to navigate. Bonds have matured or been called and replaced with lower and lower rates meaning that it's been nigh on impossible to keep the EPS growing (and in fact it's fallen). He has tried to trade his way a bit, and issued more equity at a premium with some degree of leverage, all to try and keep the plates spinning. My view (and why I continue to hold) is that I think IF thinks an era of higher interest rates is coming and this will turn the tide back (slowly) in the other direction and corporate borrowing rates will be more "normal". Well, we will see. But back to my opening remarks about Rea/ Matalan, I await the next report which should show these late coupon payments and in effect boost the next set of results. If they do, we can relax a little. If they don't, then be worried! Meanwhile, the reserve is there for a reason. Guitarsolo |
Posted at 28/4/2022 11:20 by marktime1231 Checking back having sold up last July, got out because I was expecting NCYF cannot sustain an 8% yield. I guessed they would be looking to merge with another high yield trust and reset lower. And yet it is still going strong, trading at a healthy premium.In February the interim report to 31 Dec 2021 came with the dire news that revenue in H1 was just 2.09p versus 2p paid in dividends. Despite which it said it continues to aim to increase total dividends paid, which last year were 4.47p (full year revenue to June 2021 was just 4.18p). How on earth can you do this, a shortfall from gross portfolio revenue, and ongoing charges are 1.25%? We will "draw modestly on reserves" over the next couple of years they say. Actually issuing new shares £10-20M pa and increasing gearing. Are new investment opportunities coming along at 10%+ interest rates to justify raising funds? Or are they trading and borrowing to plug the gap in underlying revenues? This has all the hallmarks of a scandal, increasing pay outs to attract new investors at a premium but increasingly unable to cover the coupon from income. Like a ponzi scheme, covering commitments to existing shareholders with fresh subscriptions. Or have I missed something? The market is not stupid and is still buying in at 7% premium to NAV. |
Posted at 14/10/2021 11:29 by panshanger1 Dividend income - would love to see a nice dip like we had 6 months ago when a high profile investor sold Then add some more |
Posted at 09/3/2021 17:00 by panshanger1 MRF: He also runs a couple of investment trust portfolios for investors chronicle His comments and changes to portfolios / performance appear roughly every 4 weeks He has a following |
Posted at 09/3/2021 16:58 by my retirement fund Excellent performance over the years Lol. LOl !!!! I've been here since the credit crunch when there was a safe and sensible discount to NAV against a decent deleveragand quality portfolio amd I have watched them gradually transform the portfolios to an ever riskier asset classed portfolio in a never ending scramble to maintain yeild. They have dramatically increased equity investment by issuing equity at premium to NAV in recent years too boot. Personally I very much doubt investors appreciate how much risk they are now carrying at the present (and falling) NAV. But hey ho, no limit to folks ignorance and above all, when it comes to valuations one thing I have always said. Never ever under estimate the stupidity of the stupid. |
Posted at 09/3/2021 09:29 by winsome High yield funds are suffering past few days. Look at HDIV and IPE. Also dived as investors' current fear of the week is inflation. Probably not a good idea to think John Baron or otherwise has any inside info or better knowledge than the rest of us. I've held NCYF for years and will continue to do so, so recent share price movement of no concern. |
Posted at 19/8/2020 12:47 by ramellous Had a mention on interactive investor.A more intriguing option is CQS New City High Yield (LSE:NCYF), a £233 million trust run by equally seasoned bond investor Ian Francis. This high-income specialist yields an eye-watering 9.3%, which indicates that it is not for the nervous. Nevertheless, the shares trade on a premium of around 3%, which is far lower than many other specialist income-producing trusts. But what adds to the attractions of this trust are its revenue reserves: at £17.3 million and rising this equates to almost a year’s worth of the previous year’s total dividend, which is a handy cushion. |
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