Overweight positions in Asia and Latin America have helped the Murray International Trust’s net asset value rise 30.1 per cent in the first half of this year, compared to 10 per cent for the benchmark.
The regions have been boosted in sterling terms due to the currency’s weakness following the UK’s vote to leave the EU.
The share price of the trust, managed by Bruce Stout, increased 22.7 per cent marking a move from a premium to a discount to NAV.
Chairman Kevin Carter says positive stock selection in Thailand, Taiwan, Singapore, Hong Kong, Chile and Brazil helped boost results, alongside sterling weakness, which has lifted Asian and Latin American returns.
“By far the largest contributing factor to positive overall portfolio returns was sterling’s weakness; with close to 90 per cent of net assets invested internationally, the currency’s depreciation proved positive for returns,” Carter says.
The investment company’s defensive stance towards the UK and the US proved also beneficial over the six-month period.
Carter adds: “Increased portfolio diversification from constant recycling of profits over the past two years contributed both positive absolute and relative performance.
“This proved particularly relevant within the fixed income portfolio where recently established Emerging Market bonds significantly enhanced returns.”
The company’s benchmark is 40 per cent FTSE World UK and 60 per cent FTSE World ex-UK.
Hargreaves Lansdown head of investment analysis Richard Troue says “the stars aligned” for the Murray International Trust.
Troue says the current discount of 5.3 per cent could make an attractive entry point for investors given the trust has tended to trade on a premium to NAV over the last five years.
He says the 4.3 per cent yield is attractive in the current low interest rate environment and that the success of the trust is a reminder to retail investors of the benefits of a diversified portfolio.