Three top investment trusts the market has overlooked

Professional investor Richard Parfect of Seneca Investment Managers selects three investment trusts that he thinks have been mispriced by the wider market.

When assessing investment trusts’ holdings it is important to understand the fundamentals underpinning the net asset value (NAV), the value of the fund’s portfolio, while also keeping in mind that sentiment affects prices and determines whether the trust trades at a premium or a discount to its NAV.

Not all premiums and discounts are warranted, however. Investors can achieve powerful returns when they inspect the trust’s assets closely and come to appreciate that there is value in the portfolio mispriced or misunderstood by the wider market. Three examples can illustrate this situation.

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Richard Parfect, fund manager at Momentum Global Investment Management