Henderson Diversified In... Share Discussion Threads

[essentialinvestor] 08/2/2022 12:36

SP!, thought that before though and not happened.

[cc2014] 07/2/2022 15:49

I hope you mean the share price and not the NAV ;-)

[essentialinvestor] 07/2/2022 15:37

Below 80 pence on the way?.

[cc2014] 07/2/2022 14:27

Yeah but it's down to 86.7p now and tomorrow's will be worse

[brwo349] 03/2/2022 12:30

NAV rising to 88.4p
Bounced off 87.9p 2 days ago

[essentialinvestor] 02/2/2022 17:25

NAV had held up remarkably well until recently.

As CC rightly mentions in a previous post all valuations have been stretched,
so an interesting time ahead perhaps.

[cc2014] 02/2/2022 12:11

Tbh I was hoping for a breach below 80p yesterday but it didn't happen and now looks unlikely at least in the short term based on what I see on L2.

Looking at the NAV this is down at 87.9p off the recent highs of 92p from August last year and I'm guessing will remain under presssure whilst we have worries about persistent inflation.

[brwo349] 02/2/2022 11:24

This is blue which can't be right. I've sent my monitor away for repair.

[superiorshares] 22/1/2022 17:28

I will be into HDIV in due course.
I am in the inflation will go aot higher camp . Also my camp says it will be here a lot longer. If transitory means 2/3 years ?.. then by all means call it transitory .
I agree with all the comments on Central Banks they will not raise rates too high. However that's irrelevant, inflation will collapse everything. My Camp says Central Banks need removing. Take a look at the European Central Bank for example .. JEEZ look at its legacy on the economy , insane debt levels and not just bankrupt companies but it has bankrupted several Countries ... oh and by the way they are the brainy people 😀

[cc2014] 11/1/2022 12:59

#217

NAV now fallen below 90p off the high from a few months ago of 93p.

Still a decent discount to NAV but it's closing to the downside

[hindsight] 06/1/2022 14:38

Thank you digitaria

[digitaria] 06/1/2022 13:23

#216 the maturity distribution is provided in the Morningstar generated factsheet, a link to which appears under the "Documents" tab on the AIC website i.e. hxxps://www.theaic.co.uk/newcompanydata/0P00009Y69/documents.

HDIV seems to have rather longer maturities than say BIPS.

[cc2014] 04/1/2022 14:09

But is it in the price already? Remember HDIV owns alot of long dated bonds. I will use an example.

HDIV's largest holding is Nationwide CCDS. These are shares which pay a fixed interest rate of 10.25% in perpetuity (unless various things happen when they would pay zero instead).

Today they are trading at 189p, giving a yield of 5.4%. Broadly, if the BOE base rate went to 3% then the actual yield would have to rise to 8.15% to keep things equal. And at 8.15% the share price would be around 125p. That would be a 34% capital loss.


Of course, my example suggests BOE raise the interest rate to 3%. I've pulled that out of thin air and I don't think any of us think it's going that high any time soon but you can re-run the numbers for a 1% rise or 2% rise or whatever you feel appropriate.


However, we should also consider just how puffed up valuations are by all the QE.
In August 2018 when interest rates were last at 0.75%, which seems a likely position by late this year, this share was trading at about 165p. In Aug 2016 when the interest rate was last at 0.25%, this share was trading at around 132p. Of course Nationwide's balance sheet wasn't as strong then. Maybe valuations will remain puffed up, maybe they won't. I don't know.


So, sure the discount to NAV is large, but if the NAV falls year on year as interest rates rise, that won't stop the share price falling too. There's not much point in collecting an annual dividend of 5.25% if the share price falls 5% in a year, regardless of the discount to NAV.

It all depends really. Do we have stagflation? Will the central banks act to squash inflation? HDIV's Board believe inflation is transitory and have positioned the portfolio accordingly.

[hindsight] 04/1/2022 13:31

Is there an easy way to compare the duration of the bonds the trusts above hold ?

[brwo349] 04/1/2022 13:03

yes but is this being accounted for already. The hargreaves lansdowne website is very good for showing the premium or discount to net asset values of investment trusts over a period of time. For hdiv the discount is now 9% and it has only been bigger than that over the last 5 years when the pandemic first hit.
hxxps://www.hl.co.uk/shares/shares-search-results/h/henderson-diversified-income-gbp0.01

[cc2014] 04/1/2022 08:16

#212 the yield on the first row for AXI is 6p or around 6.1% at today's buy price.
I haven't checked any of the rest.

#213 Refer to my post 211. It depends where you think interest rates are going, which is largely dependent on inflation. Personally I am worried the central banks have gone too long and too large with QE and there is some risk that inflation becomes embedded. I am avoiding HDIV at present until things become clearer.

[brwo349] 03/1/2022 18:28

According to google share price the 12 month changes are -

BIPS -1.84%
HDIV -11.5%
NBMI +9.7%


Does anyone else think HDIV has been clobbered too much and is the standout buy for 2022 in this investment trust sector?

[peterbill] 03/1/2022 17:43

Had a look in Trustnet website for similar Investment Trusts (funds) to HDIV and NBMI - my search returned these 8 below in no particular order. Loans and Bonds sector ...

I had only known of 3. NCYF appears to have the highest yield. All gained in value over 1 year except HDIV. Please doube check the figures.


Fund Risk Score Price NAV Yield 1 y (%) OCF AXI 71 95.50 105.00 4.71 13.9 1.40 NCYF 121 55.80 52.99 8.01 16.4 1.25 CCPG 95 105.75 110.20 4.49 16.9 1.54 HDIV 117 82.20 90.90 5.35 -6.1 0.93 BIPS 129 187.25 193.91 5.74 4.2 1.01 MGCI 134 99.50 101.20 4.23 13.1 0.87 NBMI 112 89.60 95.29 5.66 16.4 1.11 SMIF 116 94.90 91.27 6.87 14.3 1.14



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[brwo349] 31/12/2021 13:00

ah I see. Interesting. I bought today at 82.25p and prepared for a bumpy ride in the next few months but I think will do ok.

[cc2014] 31/12/2021 12:41

HDIV is stuffed full of long maturity fixed rate bonds so with the recent interest rate rise the fund suffers capital losses.

NBMI is about 2/3rds of short to medium maturity floating rate bonds so with the recent interest rate rise it's income flows stays much more aligned to interest rates.

But note, the credit risk in NBMI is much higher, there is no free lunch in this game

[brwo349] 31/12/2021 12:14

why has this performed so much worse than NBMI recently?

[cwa1] 02/12/2021 08:30

XD this morning, pay day 30/12

[greybroath] 25/11/2021 18:08

Any thoughts on why the discount is widening?

[cwa1] 10/11/2021 17:21

Market purchase by the Company of its own shares

Notification is given that, pursuant to the authority granted at the Annual General Meeting of the Company held on 16 September 2021 to make market purchases of the Company's own shares of 1p, a market purchase of 440,000 ordinary shares in the capital of the Company was made today at a price of 83.58p per share. The shares will be cancelled.

Following the above purchase, the Company's issued ordinary share capital will be 187,784,303 ordinary shares of 1p each. No shares are held in Treasury. Therefore, the total number of voting rights in the Company is 187,784,303.

The above figure (187,784,303) may be used by shareholders as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, Henderson Diversified Income Trust plc under the FCA's Disclosure Guidance and Transparency Rules.