London, UK, 14 Februar 2024
Edison issues update on The Diverse Income Trust (DIVI): Manager anticipates a small-cap super cycle
The Diverse Income Trust’s (DIVI’s) managers Gervais Williams and Martin Turner focus on generating a dividend income stream that is more resilient and has the potential to grow faster than those of the trust’s peers. They believe that over time this strategy should lead to superior capital appreciation as well as income growth. Since launch in 2011, DIVI’s dividend has compounded at an average annual rate of around 6%. UK stocks have been out of favour with global investors, who now make up around two-thirds of the UK shareholder base compared with 17% in 1994. As a result, the UK market looks very attractively valued in both absolute and relative terms, so there may be considerable upside potential from an improvement in sentiment towards UK stocks.
The UK chancellor has recently mooted ringfencing a part of the annual ISA allowance for UK equities to reduce local selling of domestic stocks. Williams and Turner believe that even a slight reduction in selling pressure, coupled with large-cap buybacks, could prove very supportive for the performance of the UK market.
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