The price for an OEIC would trade closer to par all the time and it would make it far, far easier for very large holders like Saba to cash out close to par. |
The discount has been narrowing since last June and is really not great by the standards of these things. You buy at a discount and sell at a discount, what's the big deal?If I'd wanted an OEIC I wouldn't have bought this in the first place |
Meeting requisition delayed 60 days:
"Since the receipt of the Requisition, the Board has consulted with a number of the Company’s largest shareholders, including Saba. Following constructive discussions, Saba has agreed to withdraw the Requisition for a period of 60 days to enable the Company and its advisers to formulate proposals that are in the best interests of all shareholders." |
Why won't it work? Better proposition than the first round of Saba proposals. This Board has allowed MCT to trade at a persistent discount and not bought back any shares. Allows some to exit at pretty much nav and those of us that want exposure to this portfolio to hold in a different vehicle |
Saba won't succeed here either. |
Saba's now moving on MCT. The idea appears to be to convert it into an OEIC:
"Saba Capital has requisitioned four trusts to try and force them to provide liquidity for shareholder by transitioning into open-ended funds.
...
The hedge fund is therefore proposing a transition into an open-ended fund that would eliminate the discounts the trusts trade and provide liquidity while maintaining the same investment strategy. Rolling over an investment from a trust into an open-ended fund would not trigger capital gains tax, making it an efficient solution for investors."
hxxps://citywire.com/investment-trust-insider/news/saba-strikes-again-activist-bids-to-switch-four-trusts-into-funds/a2459466?re=128504&refea=330515&link_id=1811469 |
So far, so good. |
I wonder how the TSX will open |
Sigh of relief here. For now. |
 On Friday the TSX was down 1% but is still close to all time highs so rightly or wrongly that market hasn't been showing signs of panic yet. MCT's portfolio is weighted towards oil, financials and REITs so might dodge the worst of it - autos and manufacturing might be worse hit - but we'll see. Canada has announced retaliatory 25% tariffs on some US goods.
The tariff on oil is to be 10% and someone on Bloomberg was saying that US refineries are reliant on the type of heavy crude that Canada produces and exports to the US - IIRC 3/4 of all oil at the main storage hub in Cushing, OK is from Canada - so they'd be surprised if US imports fell massively.
Obviously with a closed ended fund the price of MCT could move differently to Canada's overall market and the constituents of the fund. It's always been fairly illiquid and probably even more so now that Saba owns 29.16% (11.54% through shares + 17.62% via "financial instruments") so it probably won't take too many people panicking on Monday to push the price of MCT lower. |
I agree. I am surprised the share price did not drop on Friday. |
Bad news for MCT shares on Monday? Trump tariffs on Canada, Mexico and China starting today. |
Owch! Buying opportunity or has the bottom really just fallen out of Canada's world. The words Trump and tarrifs spring to mind, but they must at least be partly priced in already. |
Yes, Canada in general has done well. I was buying quite a lot at around the 102p level. Wish I’d bought more… We’ve been here before though, getting to c.120p for it to then tank. GBP has strengthened a lot vs CAD so this is a headwind.
On the other hand a few days ago it was announced that Saba Capital had increased its effective stake in MCT via swaps to 10% from 5%. This is the US closed end fund that for the past year or two has been building stakes in many UK ITs as it says it sees value here. |
A year since the last post on Middlefield!Well it's has a good run the last couple of months ... |
Thanks all for the feedback. Looking for Canadian 'value' but I suspect we have further downside. Don't really want exposure to US 'froth' so sitting on my hands for now. |
FABius1 - liked the IM, but not the trust. |
SKYSHIP. Thanks. |
Given the differentiated portfolios I hold both. The discount at CGI is indeed wide, but it has been for a long time |
FABIUS - IMO CGI a better buy - trading at a 36% NAV discount versus just 14% here. Yield much the same at 4.5% versus 4.8% here.. |
p56. Out of interest, I am looking at exposure to Canada. It is a tiny IT. Were you favourably impressed and are you likely to invest in the fund and have you looked at other alternatives? |
Am not a holder. However, turned up at today's AGM (held at it's broker's offices - Investec) and asked to attend as a guest so that I could hear the "expected" presentation by the investment manager (i.e. Dean Orrico). Panic ensued. There was no prepared presentation, nobody was expected to come, etc. However, after the official meeting, Mr Orrico (who had flown in from Canada) came and spoke to me 1-1 for just over 5 minutes. This was much appreciated and I found it very useful. |
Nominal increase in the dividend, but at least it's the first increase since 2016 |
Trading buy. |
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