Bankers Investment Trust (LON:BNKR) aims to reward investors who take the additional risk of investing overseas with total returns in excess of those they could have achieved at home (as measured by the FTSE All-Share Index). The trust has a diversified approach, with lead manager Alex Crooke setting the geographical allocation, and regional sub-portfolios managed by specialists at Henderson Global Investors. Value and income are key tenets of the investment process, and the trust has recently achieved a record 50th year of annual dividend growth. BNKR has a long-term record of outperformance versus its benchmark. In the past year it has simplified its fee structure and acted as one of two rollover vehicles for investors in Henderson Global Trust, boosting assets under management by c £60m.
Investment strategy: Global portfolio with value bias
BNKR’s lead manager, Alex Crooke, sets the geographical allocation and gearing level for the portfolio, as well as taking responsibility for the UK portfolio. Regional portfolios are managed by specialist colleagues at Henderson Global Investors. All the managers take a bottom-up approach to stock selection, and the overall style of the portfolio is biased towards investing in cash-generative, dividend-paying companies trading at attractive valuations. The aim is to achieve a blend of capital growth and above-inflation dividend increases for investors.
Market outlook: Balance of risks and rewards
With equity markets on both sides of the Atlantic having reached multiple all-time highs so far in 2017, investors could be forgiven for focusing more on potential risks than further rewards. Forward P/E valuations in most markets are well above 10-year averages and in some cases at or near 10-year highs. However, with scope for earnings improvements, continued support from a weaker sterling and many markets offering an attractive dividend yield, UK investors with a total return focus could still benefit from a more global approach to equity investing.
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