Manager outperformance drives rise in NAV return at Witan Investment Trust

FTSE 250-listed Witan Investment Trust generated a Net Asset Value (NAV) total return of 15.6 per cent, outperforming the benchmark's return of 13 per cent in the year ended December 31st.

FTSE 250-listed Witan Investment Trust generated a Net Asset Value (NAV) total return of 15.6 per cent, outperforming the benchmark's return of 13 per cent in the year ended December 31st.

The company reported that its NAV total return over the last five years was 18.7%, 3.7% ahead of the benchmark.

In the full year, the dividend increased by 10%, 7.0% ahead of the rate of inflation and the company reported that quarterly dividends would be introduced from 2013.

It said that the principal contributors to the NAV total return were a 2.0% outperformance by its managers and a 1.5% benefit from the use of gearing during a year of rising markets.

Additionall, there was a +0.5% contribution from a decline in the effect from marking its debt to market values and a +0.1% benefit from share buy-backs, the company said.

These factors were offset by the cost of borrowings, -0.6%, and by operating and investment management costs, -0.9%.

The company reported that falling inflation globally, quantitative easing and theoretical geopolitical events which did not materialise furher supported returns.

"The two principal drivers of the strong returns were more pro-active official policies to sustain economic growth, acting on the dry tinder of the low equity valuations which prevailed at the end of 2011," the company reported.

"Although arguments will continue over the policy of quantitative easing, it has undeniably helped offset the negative effects of contraction in the banking sector and kept interest rates low, which benefits borrowers."

"The positive returns for equity investors were assisted by a number of feared events which did not happen - Middle Eastern conflict did not lead to a spike in oil prices, the Euro did not implode and China did not slip into recession," the company added.

MF

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