AJ Bell Shares magazine 03 April 2025

I N RETIREMENT

We look at ideas to help plan and inform your future

07 S&P 500 endures worst quarter since 2022 on stagflation fears

08 Interest in European infrastructure and renewables continues to build

09 Why WH Smith was prepared to sell its High Street stores at bargain basement price

1 1 Shares in Naked Wines pop to year-high on plan to unlock value

1 1 Aston Martin Lagonda shares skid to new low on US tariffs

12 Analysts predict double-digit sales and earnings growth at Tesco

13 Hopes are riding on a good performance from bellwether JPMorgan GREAT

IDEAS

14 Buy 3i Infrastructure for its high quality portfolio trading at an enticing discount

16 This trust is delivering rising dividends and capital growth from the ‘Land of the Rising Sun’ UPDATES

19 Gaming Realms delivers record results and £6 million buyback

20 COVER STORY BALANCING GROWTH & INCOME IN RETIREMENT

We look at ideas to help plan and inform your future

29 How two Czech billionaires are planning to dominate the UK’s postal locker market

35 Are ISA investors more adventurous than SIPP investors? 25 INVESTMENT TRUSTS Investment trusts are bowing to shareholder pressure

How much extra you’re paying HMRC thanks to frozen

45 ASK RACHEL

How do I go about taking a lump sum from my SIPP? 48 INDEX

Three important things in this week’s magazine

Balancing growth and income in retirement

How to think about your investments as you approach and enter drawdown and why balance is important.

The battle for the postal locker market

The suitor for Royal Mail owner International Distribution Services Daniel Kretinsky is among those duking it out in this fast-growing space.

Visit our website for more articles

Did you know that we publish daily news stories on our website as bonus content? These articles do not appear in the magazine so make sure you keep abreast of market activities by visiting our website on a regular basis.

Over the past week we’ve written a variety of news stories online that do not appear in this magazine, including:

Interest is building in European infrastructure and renewables assets

Money is flowing into this space as countries look to boost their resilience and independence.

The first-quarter market winners and losers

We have reached the end of a tumultuous first quarter for global markets, from which the key takeaway has been the extremely weak showing of previously allconquering US stocks.

Martin Gamble looks at the latest developments from across the Atlantic in this issue. As the table shows, there have been winners as well as losers in the first three months of 2025.

The resurgence of the German stock market is one of the big stories as investors warm to a policy agenda of spending significant sums on defence and infrastructure.

The performance of European defence names, and Germany’s Rheinmetall (RHM:ETR) in particular, has been nothing short of astonishing. Kudos to anyone predicting these trends as the bells tolled to ring in the New Year.

The need for greater European self-reliance in the face of the Trump administration’s dramatic shift in foreign policy has helped the wider region, although not to the same extent as seen

First-quarter performance of major global markets

performance

First-quarter performance

Table: Shares magazine • Source: Sharescope,

Table: Shares magazine • Source: Sharescope, data from 31 December 2024 to 31 March 2025

in Germany. Ian Conway reports this week on the significant capital flows moving into the European infrastructure sector.

Chinese stocks have also bounced from depressed levels, partly helped by the emergence of the Deepseek AI model and accompanying renewed enthusiasm for the country’s tech names but also by hopes for further stimulus efforts on the part of Beijing.

These themes are represented at a stock level with Chinese electric vehicle play Xpeng (9868:HKG) and e-commerce and technology firm Alibaba (BABA:NYSE) among the big global winners.

UK-listed precious metals miners Greatland Gold (GGP:AIM) and Fresnillo (FRES) have also shone as gold’s safe haven credentials have helped drive it to record highs.

However, the increased volatility and unpredictability in the markets make strong arguments for a diversified approach – a topic we will return to in more depth in an upcoming issue.

S&P 500 endures worst quarter since 2022 on stagflation fears

Consumer confidence continues to ebb away across the Atlantic

US

stock markets were already on the ropes before the release of PCE (personal consumption expenditures) inflation data and the University of Michigan consumer confidence report on 28 March, but it was the latter which stoked further losses, taking the S&P 500 down almost 2% on the day.

Most concerning for investors was the combination of falling consumer confidence and sharply rising inflation expectations, driven by tariff concerns.

Economist James Knightly at investment bank ING commented: ‘US data is only inflaming stagflation fears.’

The final reading of the University of Michigan confidence index was revised down to 57, from a preliminary reading of 57.9. The drop reflected a substantial deterioration in consumer expectations.

The survey’s director Joanne Hsu said: ‘This month’s decline [in sentiment] reflects a clear consensus across all demographic and political affiliations.

‘Republicans joined independents and Democrats in expressing worsening expectations since February for their personal finances, business

conditions, unemployment and inflation,’ added Hsu.

Meanwhile survey respondents believe inflation will average 5% over the next year and stay above 4% for the next five years, the first time longer-dated expectations have topped 4% since 1993.

The latest reading of core PCE, which is the Federal Reserve’s favourite measure of inflation came in at an annualised 2.8%, slightly above the 2.7% expected by economists.

It is not just consumers who are getting jittery about inflation. Bond investors are concerned too, with two-year implied inflation creeping above 3% for the first time since the mini-banking crisis in the spring of 2023.

The PCE report showed consumer spending increased by 0.4% month-on-month, falling shy of the 0.5% increase economists had anticipated.

The data prompted Goldman Sachs (GS:NYSE) to revise down its forecast for first quarter GDP by 0.4% to an annualised 0.6%, with the investment bank citing softer than expected consumer spending and a downward revision to January’s growth.

US stock markets served up their worst quarterly performance since 2022 in the first three months of 2025 and the worst relative return against the rest of the world since the second quarter of 2002.

This is reflected in defensive sectors leading the way including cigarette maker Philip Morris International (PM:NYSE) which is up by a third and making new highs, and telecoms giant AT&T (T:NYSE) which is up by a quarter and making new five year highs.

The world’s second largest healthcare group CVS Health (CVS:NYSE) is up by a whopping 50% so far in 2025, demonstrating the classic defensive features of the sector.

Electric car maker Tesla (TLSA:NASDAQ) is one of the worst casualties of the ‘risk-off’ mood, falling by nearly 40%. [MG]

Interest in European infrastructure and renewables continues to build

Swedish fund EQT is investing heavily, including in UK energy storage

In all the excitement over European countries ramping up spending on defence in order to compensate for the US’s isolationism and Russian aggression, most investors and commentators overlooked one small but critical detail.

These spending plans aren’t just about defence, they include a commitment to making sure Europe has a resilient infrastructure, including energy independence, which means greater spending on renewables and energy storage.

This hasn’t been lost on large investors like hedge funds, private equity and sovereign wealth funds, and the recent takeovers of BBGI and Harmony Energy Income Trust (HEIT) are probably a sign of more deals to come.

Harmony’s non-executive chair Norman Crighton said the trust’s assets had attracted ‘a strong level of interest’ both from rival operators and private buyers, with power generation firm Drax (DRX) emerging victorious.

‘The European opportunities we are seeing now are more attractive and more interesting than they were just a few years ago,’ said Masoud Homayoun, head of global infrastructure at Swedish buyout giant EQT (EQT:STO), in a recent interview with the Financial Times.

The need – and indeed the desire – to support private investment in infrastructure across Europe is now stronger than at any point in the last decade, added Homayoun.

EQT has around €270 billion or £225 billion in assets and is already a major player in renewable energy worldwide.

Last week, the firm closed its sixth infrastructure fund after raising €21.5 billion, €1.5 billion more than it had planned, with 70% of commitments coming from existing clients.

The new fund has agreements or is in talks to invest in 12 companies mainly involved in decarbonising and decentralising energy generation and storage, including one of the largest

Harmony Energy Income Trust

providers of flexible generation in the form of largescale batteries in the UK, according to the firm.

Meanwhile, US alternative investor Blackstone (BX:NYSE) recently acquired a stake in the owner of Aberdeen, Glasgow and Southampton airports from PSP, a Canadian pension fund.

Blackstone’s infrastructure unit also owns stakes in Mundys, which operates 5,800 miles of toll motorways in France and Spain as well as Rome’s Fiumicino and Ciampino airports, and Signature Aviation, the Luton-based provider of airport services formerly known as BBA Aviation.

In 2024, Spanish group Ferrovial (FER:BME) agreed to sell the majority of its stake in Heathrow airport to private equity group Ardian and the Saudi sovereign wealth fund, while Gatwick airport is co-owned by French group Vinci (DG:EPA) and an investor group managed by Global Infrastructure Partners, part of US investment powerhouse BlackRock (BLK:NYSE). [IC]

Why WH Smith was prepared to sell its High Street stores at bargain basement price

Sale focuses FTSE 250 firm solely on the faster-growing Travel business

Iconic British retailer WH Smith (SMWH) is on the cusp of a radical transformation from newsagent and stationer into a pure-play global travel retailer, having agreed to sell its iconic UK High Street business to Modella Capital for an enterprise value of £76 million.

Set to complete this summer, the deal for the profitable High Street chain, an important feature in the UK retail landscape for over two centuries, was priced below expectations, while net cash proceeds coming to WH Smith will be just £25 million once adjusted for transaction and separation costs.

One reason for the shortfall versus expectations may be that the sale does not include the WHSmith brand, which will remain exclusively associated with the Travel retail business. Also excluded is WH Smith’s online greeting card business, funkypigeon.com, which might go under the hammer at a later date.

Management argue the disposal frees up WH Smith’s management to focus on the cashgenerative and faster-growing Travel business with stores in airports around the world and in UK hospitals, railway stations and motorway service areas. These benefit from a captive audience which allows the company to charge premium prices for

its products.

Travel generated 75% of the group’s revenue and 85% of its trading profit in the year to August 2024 and by removing exposure to the UK High Street, WH Smith insists the sale will enhance its revenue growth and margins and accelerate growth in trading profits and earnings per share whilst maintaining its ‘attractive free cash flow generation’.

With more than 1,200 stores across 32 countries, the Travel arm will hope to benefit from a 2.5 times increase in air travel passenger numbers between 2024 and 2050, driven by both population and economic growth, and increasing global investment in airport infrastructure creating more opportunities for airport retailing.

WH Smith also argues the Travel business is in ‘a strong position to roll out its one-stop-shop strategy as landlords look to combine travel retail concepts’ and with its strong track record of making valuecreating acquisitions in the travel retail space, will continue to ‘look at opportunities when they arise’.

As for the 480 High Street stores employing around 5,000 staff, they’ll transition to new ownership under Modella, the retail turnaround specialist renowned for recent investments in brands including Hobbycraft and The Original Factory Shop. The stores will operate under the WHSmith brand for a transitional period before rebranding as TGJones, a name choice which has attracted some scorn yet one Modella insists ‘carries the same sense of family’ as the WHSmith brand. [JC]

Shares in Naked Wines pop to year-high on plan to unlock value

Shares in online drinks retailer Naked Wines (WINE:AIM) jumped 10p or 16% to a new 12-month high after the company unveiled a new strategic plan to generate sustainable earnings growth and deliver ‘significant’ cash distributions.

There are three legs to the plan, the first being to achieve £75 million of cash from the balance sheet largely by liquidating £40 million of excess inventory.

The second is to get to £10 million to £15 million of annual EBITDA (earnings before interest, tax, depreciation and amortisation), assuming revenue stabilises at around £200 million to £225 million based on ‘a profitable core of members’.

The third leg is to achieve 5% to 10% annual sales growth, which the company sounds confident it can manage as it has ‘the right customer membership model’. If all goes well, the board will allocate surplus capital to whatever maximises value

for investors including buying back shares.

Analyst Andrew Wade at US broker Jefferies commented: ‘While there is plenty of detail to be worked through here, it is encouraging to see Naked committing to significant cash returns, a substantial EBITDA and a longer term growth agenda.’ [IC]

Aston Martin Lagonda shares skid to new low on US tariffs

Shares in luxury carmaker Aston Martin Lagonda (AML) dropped 5p or 7% to an all-time low of 69p on news the US would introduce a 25% ‘customs surcharge’ on all imported cars starting this month.

Other European and Asian carmakers also saw their shares slide, as imports make up around 50% of vehicles sold in the US, and concern spread to the supply chain.

While wholesale deliveries of Aston Martin cars were down across the board last year, the Americas still accounted for the largest share of the company’s sales at 1,928 units or 32% of the total.

In its year-end presentation, the company said it expected a ‘material’ improvement in its results with positive adjusted EBIT (earnings before interest and tax) this year and positive free cash flow in the second half.

Unfortunately, we suspect it won’t be long before the firm has to revise its outlook in the face of 25% tariffs on its sales into the US.

The company has subsequently announced plans to raise £125 million. This will be achieved through an investment from executive

chair Lawrence Stroll’s Yew Tree consortium (while asking for an exemption to the rule which would usually trigger a mandatory takeover when shareholdings exceed 30%) and a sale of its minority stake in the Aston Martin Aramco Formula One team. [IC]

UK UPDATES OVER T HE NEXT 7 DAYS

FULL-YEAR RESULTS

8 April: JTC, Property Franchise, Staffline

9 April: Churchill China, Oxford Biomedica, Saga

10 April: Brave Bison, Hvivo, Inspects Group, Tesco, US Solar Fund FIRST-YEAR RESULTS

7 April: Applied Nutrition

TRADING ANNOUNCEMENTS

9 April: JD Sports Fashion

Analysts predict double-digit sales and earnings growth at Tesco

The UK’s largest grocer has extended its lead over the competition

As we have been documenting in Shares over the last few weeks, the big winner in the supermarket sector over the last year or so has been Tesco (TSCO), which has been steadily growing its market share at the expense of Asda and Morrisons while simultaneously holding off the threat from the discounters Aldi and Lidl.

That hasn't prevented a recent sell-off in the company's shares as investors react to the potential for Asda to launch a price war in the sector, something Tesco management may be expected to address when it posts full-year results on 10 April.

The company’s market share has risen from 27.3% a year ago to 27.9% as of the latest survey of grocery spending by consultants Kantar covering the 12 weeks to 23 March.

At the same time, Asda and Morrison’s combined share has fallen from 22.3% to 21% while the discounters account for 18.8% of spending against 18.1% a year ago.

What the market expects of Tesco

What the market expects of Tesco

As well as introducing an ‘Aldi price-match’ campaign, Tesco has leveraged the growth in its Clubcard loyalty scheme to bring ever more

What the market expects of Tesco

shoppers through its doors, while at the same time its Finest range continues to enjoy strong demand.

In its third-quarter and Christmas trading update the firm said it had achieved its highest UK market share since 2016 thanks to net switching gains from other supermarkets as it positioned itself to be the cheapest full-line grocer for a second year running.

When it reports its results for the full year to February 2025, analysts are predicting a 15% increase in group sales from £61.6 billion to almost £71 billion.

Operating profit is expected to rise by between 8% and 9% to a shade over £3 billion, above the firm’s guidance as of the third quarter, as it reinvests some its sales gains in lowering prices to drive volume growth, while EPS (earnings per share) are seen rising by 15% from 23.4p to 26.9p. [IC]

Hopes are riding on a good performance from bellwether JPMorgan

The US’s biggest bank needs to reassure the market when it reports

One thing investors will be hoping they can rely on, amidst all the uncertainty over tariffs, the economy and interest rates, is a solid trading update from JPMorgan Chase (JPM:NYSE) when it reports firstquarter earnings on 11 April.

Results for the final quarter of 2024 were driven not by the core business of loans and deposits –average loans were up 2% on the previous year, as were average deposits – but by investment banking, where fees rose almost 50%, and markets, where revenues were 21% higher.

At that stage, chief executive Jamie Dimon was upbeat about the outlook: ‘The US economy has been resilient: unemployment remains relatively low, and consumer spending stayed healthy, including during the holiday season.

‘Businesses are more optimistic about the economy, and they are encouraged by expectations for a more pro-growth agenda and improved collaboration between government and business.’

While Dimon foresaw persistent inflation being a potential risk,

he couldn’t have foreseen the effect on corporate and consumer confidence of the unexpected policy decisions taken in the first 100 days of the Trump presidency. Businesses are pricing in worst-case scenarios, and chief executives and finance directors are pausing spending decisions, freezing hiring and lowering guidance ‘not because their business is falling apart but because the range of possible outcomes is too wide to plan around,’ as one observer commented.

As it stands, analysts are expecting JPMorgan to post a 4% increase in first-quarter revenue to $43.7 billion and a 3% increase in EPS (earnings per share) to $4.57, so the bar isn’t set very high.

However, for the full year analysts have penciled in a 10% increase in EPS to $18.31 so investors will be watching carefully for any downward revision to the outlook, especially as the shares have significantly outperformed the S&P 500 over the last one, three and five years.

Buy 3i Infrastructure for its high quality portfolio trading at an enticing discount

The focus in on assets which are hard to replicate and have low risk of technological disruption

3i Infrastructure (3IN) 320p

Market cap: £2.94 billion

In our view 3i Infrastructure (3IN) is a unique vehicle in the infrastructure sector which gives investors access to a diversified portfolio of private sector infrastructure businesses positioned to benefit from four megatrends.

These include the energy transition, digitalisation, demographic change and renewing vital infrastructure. The group has decades of experience operating in the UK and European private markets which allows it to identify businesses with good growth opportunities.

The company actively engages with management teams to pursue accretive growth by expanding into adjacent markets or geographies, making addon acquisitions or establishing appropriate capital structures.

The portfolio has strong growth and cash flow

characteristics which, combined with capital investment, results in a compounding growth dynamic which delivers attractive returns to shareholders.

This has allowed the company to create a top quartile track record with NAV (net asset value) per share plus dividends growing at an annualised rate of 18% a year since 2015, handsomely outperforming the peer group average of 10% a year.

Headwinds from rising interest rates appear to be abating and the shares trade at a 15% discount to NAV, despite recent divestments being executed at a premium to NAV. We believe this represents a great buying opportunity to get on board a high quality, defensive growth company.

WHAT IS IN THE PORTFOLIO?

The roughly £4 billion portfolio is invested a across 12 assets which generated £273 million of total income and non-income cash in 2024, including distributions from refinancing activity.

The strategy is to invest in businesses with good asset backing, strong market positions and barriers to entry. The company is looking for operational

A FLAVOUR OF 3I INFRASTRUCTURE

To give some insight into the types of businesses the company invests in and their growth prospects, we highlight the following two companies.

ESVAGT

In the energy transition space, the company owns Danish company ESVAGT which is the global leader in the fast-growing segment of SOVs (service operation vehicles) for the offshore wind farm industry.

It is also a leading provider of emergency rescue and response vessels to the offshore energy industry in and around the North Sea and Barents Sea.

SOVs are purpose-built, high-performance vessels, providing efficient transport of maintenance technicians to wind turbines and other offshore wind equipment, under long term contracts.

The bespoke nature of the vessels and requirement for experienced crews with a proven safety record provides high barriers to entry.

Demand for SOVs is expected to grow strongly with several tenders anticipated in the next 12-months in the rapidly expanding US wind market.

TCR

Brussels-based TCR is Europe’s largest independent asset manager of airport GSE (ground support equipment). It operates at more than 230 airports across more than 20 countries.

The diversity of its operations and customer base means revenues are not materially reliant on one client or geography.

Reliable GSE is critical to the efficient running of airports and TCR helps deliver this service alongside access to scarce airside repair workshops, providing high barriers to entry.

Fleet optimisation is also important in the context of enabling decarbonisation of airport ground operations.

The business is growing strongly and in February 2024 it acquired KLM Royal Dutch Airline’s ground equipment services subsidiary at Schiphol airport.

TCR has secured multiple commercial contract wins including a centralised all-electric Ground Support Equipment pooling contract at JFK International Airport New Terminal One.

To support growth TCR completed a €450 million refinancing, comprising €250 million of new term debt and a refreshed revolving credit facility of €200 million.

This enabled a €73 million distribution to 3iN, with the balance available for reinvestment by TCR.

levers to achieve attractive returns through active management.

On 31 March 3i Infrastructure released a brief full year trading update to the end of March, saying it expected to report another period of good performance.

Bernardo Sottomayor, managing partner and head of European infrastructure, 3i Investments, commented: ‘We continue to see earnings momentum in the portfolio, driven by our strategic focus on prioritising growth investments in our existing portfolio companies.’

The company said it is on track to deliver its dividend target of 12.65p per share, up 6.3% on 2024, which is expected to be covered 2.5 times by earnings per share. [MG]

This trust is delivering rising dividends and capital growth from the ‘Land of the Rising Sun’

CC Japan Income & Growth backs cash-generative Japanese companies and is forging a formidable dividend growth record

CC Japan Income & Growth Trust (CCJI) 183p Market cap: £246.6 million

Asian markets including Japan have been caught-up in the sell-off triggered by Trump’s tariffs war, but the Japanese economy should be less directly affected by the proposed levies than both China and Europe. And the outlook for the ‘Land of the Rising Sun’ remains rosy thanks to positive inflation, rising wages and the ongoing drive by the Japanese government, regulators and investors to change the country’s corporate culture, which is having a beneficial impact on capital efficiency and corporate governance standards.

One great way to capture the capital growth and rising dividends on offer from Japan’s high-quality, cash generative and increasingly shareholderfriendly corporates is to buy CC Japan Income & Growth (CCJI), currently trading at a 9.7% discount to NAV (net asset value) that presents a compelling

entry point for investors willing to stomach currency risk.

Awarded a five-star rating by Morningstar, CC Japan Income & Growth is the best five-year share price total return performer in the Association of Investment Companies’ Japan sector with a 95% haul. And while Japan’s stock market could experience further bouts of volatility, this trust’s balanced focus on total return - i.e. capital and income growth – gives the fund a more defensive bent than growth-focused peers and it should prove less susceptible to style rotations as a result. Ongoing charges are 1.03%.

DIFFERENTIATED APPROACH

Managed by Chikara Investments’ seasoned Japanese equities sage Richard Aston, CC Japan Income & Growth offers a differentiated approach for patient portfolio builders seeking Japanese equity market exposure, since the trust targets dividend income combined with capital growth. Since its 2025 launch, the trust has outperformed the TOPIX index thanks to the stockpicking skills of Aston, who seeks out Japanese companies that pay dividends, are buying back stock, yet still offer

strong growth potential. Aston’s portfolio tends to diverge strongly from major Japanese equity indices since the manager looks for opportunities beyond just the largest companies.

The £246.6 million cap typically holds a relatively small number of stocks and this approach has paid off handsomely over time. CC Japan Income & Growth is committed to providing a progressive dividend to shareholders and has maintained an unbroken track record of consecutive annual dividend increases since inception.

Despite the unpredictability of future Bank of Japan actions and the impact of tariffs on Asian markets and economies, the Japanese equity market’s fundamental attractions remain, namely low valuations, corporate governance reforms and broader growth opportunities. The improvements in corporate governance are playing a pivotal role in transforming Japan’s dividend culture and many of the trust’s underlying holdings are placing a much stronger emphasis on enhancing shareholder returns.

DIVIDEND GROWTH CORE

Aston runs a portfolio of between 30 to 40 holdings – 37 names in the book as at 28 February 2025 – and portfolio stocks sit within three broad categories: Dividend Growth, Special Situations and Stable Yield.

The bulk of the portfolio is within Dividend Growth, and includes banks such as Sumitomo Mitsui Financial (8316:TYO) and Mitsubishi UFJ Financial (8306:TYO), as well as insurers Sompo (8630:TYO) and Tokio Marine (8766:TYO), financial

Share

total return - Five

return -

Delivering progressive payouts

companies which have benefited from the Bank of Japan’s first rate hikes in 17 years.

Stable Yield examples include Softbank Corp (9434:TYO), while Special Situations include the trust’s biggest holding, console and handheld gaming giant Nintendo (7974:TYO), whose outlook is driven by the company’s own unique product cycle and which is going through a transition from the successful Switch console to the Switch 2.

Aston also highlights the recently-listed Tokyo Metro (9023:TYO), operator of the capital city’s underground rail network, as another Special Situation. ‘It hasn’t got a five year history, but if it did, it would see dividend growth each year,’ enthuses Aston. ‘I am very confident of the outlook for Tokyo Metro and it’s a great thing that we had the opportunity to invest in it.’

Prospective investors are also buying exposure to companies including Japanese online fashion retailer ZOZO (3092:TYO) and JAFCO (8595:TYO), the nation’s leading venture capital investment business, two firms returning value to shareholders through increased payout ratios, more consistent share buybacks and dividends.

Relatively new investments include Japan Securities Finance (8511:TYO), a vital component of the daily operation of Japan’s financial exchanges, and Macnica (3132:TYO), an electronics and software distributor well-placed to help satisfy growing global demand for Japan’s semiconductor capabilities. [JC]

Table:

Small companies, big opportunities

Investing in UK smaller companies presents a compelling opportunity for investors seeking long-term growth and diversification. These companies are typically more agile and innovative than their larger counterparts. Their smaller scale allows them to pivot quickly, seize emerging opportunities, and capitalise on niche areas within key sectors, such as technology, finance, professional services and healthcare, which are helping to drive the economy.

One of the key advantages of investing in smaller companies is their potential for higher returns. Historically, smaller companies have outperformed larger ones over the long term, benefiting from their ability to grow revenues and earnings at a faster pace. While they are perceived to carry higher risks due to factors like market volatility and limited resources, these risks can be mitigated through careful

stock selection, active engagement and diversification.

The UK market offers a particularly fertile ground for smaller companies due to its entrepreneurial culture, robust regulatory framework, and access to global markets. Despite recent challenges many have leveraged their innovative capabilities to address new market demands, ranging from digital transformation to sustainable business practices.

Our WS Gresham House UK Smaller Companies Fund is well-placed to benefit from structural growth themes across various sectors.

Managed by Ken Wotton and Cassie Herlihy, and our specialist UK equity team, they look across the small cap market and target companies with high-quality financial metrics at what they consider to be attractive valuations. By focusing on companies whose long-term earnings growth and cash generation are largely independent of external economic forces, the Fund aims to provide returns less correlated to broader market or economic developments. Negative sentiment has widened the disconnect between share prices and underlying business fundamentals. This means that many well-run businesses are now trading at low prices providing attractive opportunities for managers to deploy capital.

WS Gresham House UK Smaller Companies Fund is a high-conviction, concentrated fund that looks to grow capital over the long term (in excess of five years).

PAST PERFORMANCE IS NOT A GUIDE TO FUTURE RETURNS

Gaming Realms delivers record results and £6 million buyback

Gaming Realms

18.3%

We highlighted the appeal of AIMquoted games distributor Gaming Realms (GMR:AIM) just under a year ago on the back of its ambitious profit growth targets which we felt were being underappreciated by the market.

WHAT HAS HAPPENED SINCE WE SAID TO BUY?

The company followed up a strong first-half performance in the second half to post another record set of full-year numbers on 31 March. This, plus news of a £6 million share buyback, helped revive a share price which had faltered on concerns about the broader sector backdrop.

As a reminder, Gaming Realms is a leader in the business-to-business licensing and distribution of games to the regulated gaming market.

The company owns the intellectual property to the Slingo brand, a mix of slots and bingo and one of the most popular formats of online games.

More games, partners, and territories – the winning formula continues to pay off ”

Results for 2024 revealed content licensing revenue up 28% powered by 59% growth in North America, which now accounts for 54% of the total. Crucially the company also reported a strong start to the current year with licensing revenue up 22% in the first two months of 2025.

Peel Hunt analyst Ivor Jones sums it up succinctly: ‘More games, partners, and territories –the winning formula continues to pay off.’

Despite doling out a material sum to buy back shares, the company remains in a robust financial position, giving it scope to look at M&A and other investment opportunities to drive growth.

WHAT SHOULD INVESTORS DO NOW?

We would stick with the shares given they remain on an attractive valuation ─ 10.5 times current-year earnings, based on consensus forecasts ─ and the company’s growth prospects continue to look solid.

We will keep an eye on performance through the course of the year as comparatives look set to get tougher thanks to the bumper 2024 showing and will continue to monitor regulatory threats. [TS]

By Sabuhi Gard Investment Writer

FBALANCING GROWTH & INCOME IN RETIREMENT

look at ideas to help plan and inform your future

inal salary workplace pensions are slowly becoming a thing of the past, according to figures from the PPF (Pension Protection Fund) and the Pension Regulator, with only 1,013 of the UK’s 6,400 schemes still open to employees.

As a result, more people are having to provide for themselves in the run-up to retirement and during retirement, whether that means building a pot of money or buying an annuity from which they can pay themselves a guaranteed income for life.

Annuities are a popular option: according to the (ABI) Association of British Insurers the number of pension annuity contracts jumped 24% last year to 89,600 reaching a new

10-year high.

The latest pension annuity data from the ABI shows total annuity sales reached £7 billion last year, a 34% increase on 2023.

There are other options for people with the introduction of new pension freedoms in 2015, such as entering drawdown at aged 55 or over and staying invested in the stock market.

Many people will still look to switch their portfolio towards income eventually as they will have outgoings like utility bills, grocery shopping or mortgage payments, and they will use their accrued pension pot to do this.

With this in mind, how should you think about balancing growth and income in the run-up to and once you are in retirement? We

How long do people live?

82.6 years in the UK

years in the

UK

Average life expectancy for a woman

HOW MUCH INCOME SHOULD I AIM FOR?

The amount of income you should aim for in retirement varies depending on what sort of lifestyle you want in later life.

The PLSA (Pensions and Lifetime Savings Association) gives some rough figures for the amount of retirement income needed depending on what lifestyle you want to live – minimum, moderate or comfortable.

A minimum living standard in retirement is based on spending £50 per week on groceries, £10 per week on taxis (not having a car) and £100 per year on rail fares.

A moderate living standard is based on spending £55 per week on groceries, owning a three-year old small car replaced every seven years, and taking a three-star all-inclusive holiday in the Mediterranean plus a long weekend break in the UK.

When do people retire?

The UK the state pension age is currently 66 for both men and women increasing to 67 for those born on or after April 1960.

You can access workplace or private pensions from the age of 55, increasing to 57 from April 2028. This is often seen as early retirement.

78.6

Average life expectancy for a man

Source:

A comfortable living standard is based on spending £70 per week on groceries, up to £1,500 on clothing and footwear each year and taking a two-week four-star holiday in the Mediterranean with spending money plus three long weekend breaks in the UK.

A minimum living standard would require an income of £14,400 per year for a single person and £22,400 for a couple, while for a moderate living standard a single person would need £31,300 and a couple would need £43,100 per year.

For a comfortable retirement, a single person in the UK would need an annual income of around £43,100 while a couple would need around £59,000.

Other factors affecting retirement income needs include where you live, as in a big city like London living expenses may be considerably higher than in the suburbs.

Your health may also affect retirement income needs, as you may have one-off unexpected health costs or need to factor in long-term care if you have a terminal illness.

Finally, your housing situation is important, whether you are a homeowner, whether you have a mortgage, or whether you rent.

WHAT SHOULD MY INVESTMENT STRATEGY BE?

It is important to remember when investing in later life to think about the long term.

Your pension pot may need to provide you with growth and an income for over 30 years, and ideally should generate enough income to preserve your capital.

Also, when choosing what to invest in you need to think about your risk threshold.

Ask yourself what level of risk are you willing to take – are you low-, moderate- or high-risk with your investment style?

Philip Hanley, founder, director and principal

adviser of Philip James Financial Services, says: ‘We tell our clients to achieve a decent pension income in retirement for the long term, to leave it invested in reputable low-cost managed funds. Looking at our clients, we have most of them invested in mediumrisk and balanced funds.’

Hanley acknowledges everyone is different when it comes to retirement, and it very much depends on circumstance, so there is no universal solution.

‘Few people can afford to retire bang on 55 or 60 years old. Most people wait until state pension age to retire and slow down around the 55 or 60-year mark, then look to supplement their retirement income in the form of investments, tax-free income and savings which have been invested.’

WHAT ARE THE COMMON MISTAKES?

Darius McDermott, managing director of Chelsea Financial Services, says one of the biggest mistakes people make when managing their portfolios is overloading on income-producing assets or withdrawing too much cash.

‘The reality is most people need their retirement savings to last at least 20 years, and prioritising income at the expense of growth can be risky. Even moderate inflation of 3% to 4% per year can significantly erode the real value of your savings if they’re locked in low-growth income assets. As inflation chips away at your purchasing power, maintaining your desired standard of living becomes harder, increasing the risk of running out of money too soon.

‘There’s no one-size-fits-all approach to building the perfect retirement fund, but a well-diversified portfolio that balances growth and income is generally more sustainable than an income-only strategy.

‘Your approach should depend on factors like health, life expectancy and overall wealth. The longer your investment horizon - or the more financial flexibility you have - the more you can afford to allocate toward higher-growth assets to ensure long-term financial security. As you age, gradually increasing the income portion of your portfolio is a sensible move.’

In terms of what type of financial products to invest in, McDermott told Shares: ‘Bonds offer a steady, predetermined stream of income, which has made them a staple of retirement portfolios. Specialist funds like BlueBay Investment Grade Global Government Bond (B4ZG8G2) provide a stable income stream and serve as a hedge during equity market downturns.’

McDermott also flagged diversified global equity income funds like TM Redwheel Global Equity Income (BMBQN67), which aims to provide a combination of income and capital growth over fiveyear rolling periods by investing in a concentrated portfolio of global companies.

There is also Murray International Trust (MYI), which aims to achieve an above-average dividend yield with long-term growth in dividends and capital ahead of inflation, while on the multi-asset side there are BNY Mellon Multi-Asset Balanced (B01XJG6) and Liontrust Sustainable Future Managed (B8FDBQ2).

‘There are also targeted absolute-return funds which focus on capital preservation by minimising losses during downturns while delivering steady, modest returns in rising markets,’ says McDermott.

A BALANCED APPROACH

Whatever you do, chartered financial planner Lena Patel believes you should, first and foremost strike the right balance: ‘To ensure financial security while maintaining flexibility, a well-planned withdrawal strategy is a key component of a successful retirement plan.’

Patel adds: ‘A common mistake is prioritising income over growth too early. While incomegenerating assets such as bonds and dividend-paying stocks provide stability, relying too heavily on them can restrict long-term portfolio growth.’

It is also important to regularly review and adjust your portfolio to ensure it remains aligned with your financial plan throughout retirement.

Below are four more fund ideas, two for growth and two for income, to help with a balanced investment approach.

The fund’s objective is to achieve capital growth over the long term, and it certainly seems to have done that. Over the last five years it has generated a 144% return thanks to investments in global bluechips such as Alphabet (GOOG:NASDAQ), Amazon (AMZN:NASDAQ) and Microsoft (MSFT:NASDAQ).

The focus on capital growth means the fund has a miserly dividend yield of 0.51%, while the ongoing charge of 0.71% per year is very reasonable given the performance.

For an income fund, a five-year return of 116% is pretty impressive in our book. Major holdings include Asia-focused bank HSBC (HSBA), defence stocks Bae Systems (BA.) and Rheinmetall (RHM:ETR) and US bank Wells Fargo (WFC:NYSE)

The dividend yield is 2.79% and the ongoing charge fee is 0.87%.

This is another fund which aims to achieve long-term capital growth, but as its name implies it invests in shares globally outside the UK. Over five years it has returned 122% thanks to holding stocks such as Apple (AAPL:NASDAQ), Microsoft and Nvidia (NVDA).

The fund doesn’t pay a dividend and the ongoing charge is 0.7% per year.

This fund aims to deliver a dividend yield in excess of the FTSE All Share index while providing long-term capital growth, and it looks have done that with a return of 82.6% over the last five years.

Top holdings include high-street bank Barclays (BARC), oil giant BP (BP.) and on-the-up retailer Marks & Spencer (MKS), while the yield is 3.4% and the ongoing charge is 0.79%.

Look at Global Equities from a different angle and new sources of Profits are revealed.

Fig. 1: Looks like nothing from here.

Fig. 2: But seen from here...

THE ARTEMIS GLOBAL INCOME FUND

GIVEN THE current state of the world it’s no surprise that many are reassessing their priorities and looking for new sources of Profits.

Find out more

This is certainly true of our Global Income hunter, Jacob de Tusch-Lec whose unique viewpoint on Global Equities allows him to spot Profits others have missed.

A remarkably useful trait, whichever way you look at it. The payment of income and its level is not guaranteed. Your capital is at risk.

Investment trusts are bowing to shareholder pressure

Boards are taking action to bring in discounts and boost shareholder returns, while Achilles has revealed its first activist campaign

Investment trusts are in the spotlight after Saba Capital’s high-profile campaign put boards under extra pressure to address persistently wide discounts to net asset value (NAV) across the sector.

The positive news is boards are responding, taking action to make their trusts more shareholder-friendly and listening to views on how they can add value. Here are a few examples which have caught our eye.

SABA MAKES ITS MARK

Schroder UK Mid Cap Fund (SCP) has introduced several initiatives which the board believes will strengthen the investment proposition and help bring in the discount, which has narrowed from a 12-month average of 11% to 8.5%, in part due to Saba’s stake.

The changes include a fee reduction, a threeyearly continuation vote and a more active share buyback. Schroder UK Mid Cap was one of four trusts where Saba requisitioned a general meeting in February, with a view to transition them into open-ended funds, although its request was deemed to be invalid.

Another trust targeted by Saba was Montanaro European Smaller Companies (MTE), well-placed

to benefit from renewed investor interest in Europe and whose discount has come in from a 12-month average of 12% to 8.1%.

Chaired by Richard Curling, the board has just announced a number of ‘value-enhancing initiatives’ for shareholders including a bi-annual tender for up to 5% of the share capital at a 5% discount to improve liquidity, a ‘more active’ share buyback targeting a single digit discount and a fee reduction.

Schroder UK Mid-Cap

Montanaro European Smaller Companies

fund INPP (INPP) has also unveiled shareholderfriendly measures including a £140 million increase in its share buyback to £200 million, to be funded by further disposals and a change in fees which should reduce the ongoing management fee by 10%.

The FTSE 250 trust, which has grown dividends each year since its 2006 IPO, will also step up the frequency of its distributions from semi-annually to quarterly from June 2025 to provide investors with a more regular income stream.

ACHILLES TARGETS SHED

In the alternatives space, the board of renewables trust TRIG (TRIG) has dropped proposals to introduce a transaction fee for disposals and a fee in the event of a takeover following a shareholder backlash.

The transaction fees were unpopular with shareholders who have suffered from TRIG’s de-rating and were unwilling to see the manager incentivised to make exits below the carrying value on which it has been paid fees recent years.

Deutsche Numis believes the new fee, based on the equal weighting of average market cap each quarter and the trust’s NAV, is ‘less complex and more in line with market trends of creating a clearer alignment between manager and shareholders, given the partial market cap basis’.

In line with good corporate governance, TRIG has also introduced a continuation vote if the NAV discount exceeds 10%.

TRIG chair Richard Morse commented: ‘Having listened to shareholders and carefully considered their feedback, the board has refocused and updated its original proposals’, adding ‘these ongoing fees strike an appropriate balance between incentivising the managers to focus on medium and long-term NAV accretion through active management of the portfolio and the company’s share price performance.’

Languishing on a 28.5% discount, infrastructure

With Saba defeated on multiple campaigns, stock market newcomer Achilles (AIC) has filled the activist void. Backed by City veterans Christopher Mills and Robert Naylor, Achilles launched to tackle alternative sector discounts and has identified its first target in the form of Urban Logistics REIT (SHED) Alongside other SHED shareholders, Achilles has called for an extraordinary general meeting to get shareholders to vote on kicking out three directors and replacing them with two new ones, including Naylor. If successful, the proposed new directors would work with remaining board members to undertake a review of options to ‘maximise and return value to shareholders’; these options could include suspending the recently announced internalisation

Urban Logistics

of SHED’s management arrangements, introducing discount control mechanisms and an annual continuation vote, as well as exploring whether there is third-party interest in acquiring the portfolio.

Achilles has flagged a conflict of interest with the boss of Urban Logistics’ investment adviser, Richard Moffitt, and the fact he is also an equity partner of a property-related advice business which has received millions of pounds in fees from the trust.

Urban Logistics’ board has recommended shareholders vote against all of Achilles’ proposed

board changes and believes a general meeting will give it the opportunity to put before shareholders ‘all of the relevant information regarding the true quality and potential of the Urban Logistics business, the merits of internalisation, the measures and governance the Board has in place for maximising shareholder value’, not to mention the track record of Naylor and Sangita Shah.

Achilles acknowledged Urban Logistics’ response and is waiting for the reworked internalisation proposal following shareholder feedback, which it expects to be ‘far less generous to the investment manager’.

The activist added the board’s ‘belated recognition of the excessive price proposed for the buyout of the management contract’ reinforces the team’s belief the board is too closely aligned with the investment manager.

By James Crux Funds and Investment Trusts Editor

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THE CLOCK IS TICKING –MAKE THE MOST OF YOUR ISA ALLOWANCE WITH F&C

With the end of the financial year approaching, smart investors are looking to make the most of their £20,000 ISA allowance before it resets. If you haven’t yet used your full allowance, now could be the time to act.

One collective investment fund that has stood the test of time is F&C Investment Trust. Established in 1868, F&C has helped generations of investors grow their wealth while navigating market ups and downs.

Providing access to a strategically diversified global portfolio, F&C offers exposure to both established industry leaders and emerging market opportunities - helping investors position their portfolios for the future.

“We aim to deliver long-term growth in both capital and income,” says Paul Niven, Fund Manager of

F&C Investment Trust. This measured approach means that the trust aims to balance resilience with growth, making it a potentially rewarding choice for investors looking to the future.

F&C ranks in the top 6 of the Association of Investment Companies (AIC) table of dividend heroes. It has increased the dividend it pays to investors every year for the past 53 years* – a track record that reflects the strength of its portfolio and the disciplined approach taken by Paul and his team.

Learn more about F&C Investment Trust at fandc.com

We aim to deliver long-term growth in both capital and income.”

*There is no guarantee that dividends will continue to grow.

Capital at risk. Past performance is not a guarantee of future returns. Eligibility to invest in an ISA and tax treatment depends on personal circumstances and tax rules may change in the future. The value of your investment may go down as well as up, there is no guarantee you will get back what you invest.

How two Czech billionaires are planning to dominate the UK’s postal locker market

More people are choosing lockers rather than waiting for parcels to be collected or queueing at the Post Office

With online sales rising to 30% of all retail sales last year, according to the Office for National Statistics, there are more parcels than ever ending up on people’s front doorsteps.

This has created an opportunity for unscrupulous criminals to steal goods from unsuspecting citizens who may not be home or may be unaware of the delivery.

The BBC’s Watchdog programme recently featured one community which has set up its own Neighbourhood Watch scheme to protect each other from the so-called ‘porch pirates.’

According to the consultancy Retail Economics, one in five people have experienced a stolen parcel. One answer to this trend is the use of postal lockers.

Postal lockers are safety deposit boxes ranging in size from a few inches by 12 inches to a foot and a half squared.

Retail Economics estimates 75% of Gen Z shoppers (those under 25 years of age) have used a postal locker compared with only around a third of baby boomers (those born in the two decades after the second world war)

Postal lockers are springing up all over the UK and can be seen on petrol station forecourts, at supermarkets, railway stations and even the local pub.

By simply scanning a QR or numeric code, items can be collected or dropped off rather than being left outside the front door and presenting a temptation for opportunist thieves.

With around eight million people living in flats and apartments in big cities like London, Birmingham and Manchester, some argue the UK is ripe for a postal locker revolution.

Two Czech billionaires have already spotted the

opportunity, and are battling it out for supremacy in this burgeoning market.

BILLIONAIRES BATTLE IT OUT

In the blue corner is the Czech Republic’s once richest man Peter Kellner, who amassed a $17.5 billion fortune before dying in a skiing accident in 2021.

His family investment vehicle PPS Group is the largest shareholder in Polish-based automated parcel machine maker and e-commerce group InPost (INPST:AMS), holding a 28.7% stake.

InPost dominates the UK postal locker market with around 9,000 lockers and the company believes there is potential for around 30,000 lockers in total.

Daniel Kretinsky equity holdings

In the red corner is better-known Czech billionaire Daniel Kretinsky, who hit the headlines last year when he successfully made a £3.75 billion bid for Royal Mail owner International Distribution Services (IDS). The acquisition is due to close in the second quarter of 2025.

Kretinsky built up a 27.5% stake in IDS through his investment vehicle Vesa Equity Investment, and according to Forbes his net worth is estimated to be around $10 billion.

The billionaire believes he can turn around IDS’s fortunes by investing heavily in postal boxes and has earmarked £400 million to roll out 20,000 boxes.

The snag is, Kellner’s InPost group has a significant first-mover advantage and in January said it planned to invest a further £600 million in the UK by 2029.

Britain is the company’s fastest growing market, and it expects to increase the number of lockers across the country by 50% this year alone.

In 2024, InPost completed its acquisition of Menzies, giving it full ownership of the entire logistics process in the country.

InPost chief executive Micheal Rouse believes building scale is the key to success, which means the firm must have a bank of lockers within seven minutes’ walk of homes in cities and within a seven-minute drive in rural areas.

Table: Shares magazine • Source: Vesa Equity Investment

KRETINSKY’S EMPIRE

The former investment bank lawyer has built one of Europe’s largest energy groups, Energeticky a Prumyslovy Holding, and has since been diversifying into retail, media and other sectors.

Vesa manages a portfolio of investments valued at around $3 billion which includes 10% of UK grocer Sainsbury’s (SBRY), 30% of Dutch incumbent postal operator PostNL (PNL:AMS), 10.6% of US sportswear and footwear company Footlocker (FL:NYSE) and 15% of French mailrelated solutions group Quadient (QDT:EPA), formerly known as Neopost.

Kretinsky also owns 27% of East London football club West Ham United and Czech football team Sparta Prague through his 1890 Holdings group.

The advantage for InPost in building a dense network is that it can deliver in bulk, which means operating fewer vans, bringing down costs while being less damaging to the environment.

Rouse is betting greater scale will allow the business to lower the cost to the customer as well as providing convenience, further driving adoption, although for now InPost is not quite there.

A second-class parcel starts at £3.69 from Royal Mail, compared with £3.42 for InPost, but ultimately Rouse wants to be 30% cheaper than delivering to the door.

The UK business recently turned a profit, demonstrating the success of the strategy. Inpost has long-term relationships with Tesco (TSCO), Sainsbury’s, Morrisons, Lidl and Aldi, with Asda the only major grocer not in the company’s fold.

Inpost believes it has another big advantage over Royal Mail, which is it doesn’t have to worry about cannibalisation.

For every customer who switches to lockers,

Royal Mail and Amazon (AMZN:NASDAQ) are no better off because they are existing customers who previously used home delivery.

‘I’m not eating my own profit pool, I’m eating theirs,’ explains Rouse. This may be the reason

Amazon has pared back locker expansion in the UK, for fear it may deter people from paying for Prime delivery.

Kretinsky appears to be hedging his bets, which may explain why he has stakes in InPost, IDS and Quadient. The French firm recently won a contract to install 1,200 lockers across the pub estate of Punch Taverns and several railway stations served by Northern Rail.

Expanding through Quadient may prove a more effective strategy for Kretinsky than potentially cannibalising his IDS operations. If successful, it may make sense to merge the two businesses to capture more of the value opportunity.

Whichever billionaire eventually wins out, the UK’s landscape will be forever changed by the appearance of postal lockers, much to the chagrin of those pesky porch pirates.

Finding Compelling Opportunities in Japan

Martin Gamble Education Editor

Schroder AsiaPacific Fund plc –how to diversify your tech exposure

Diversifying away from ‘The Magnificent Seven’ tech stocks

The end of the 2024/25 tax year is approaching, and investors are wondering how best to invest their tax-free ISA and SIPP allowances against a deeply uncertain global backdrop.

It’s a tricky question, in so many ways. 2024 saw North American and global funds pull off impressive performances: both the US’s S&P 500 index of large companies and the MSCI World index, which is strongly influenced by the US market, returned 25%.

But the bulk of those gains can be attributed to just a handful of mega tech stocks – the so-called Magnificent Seven companies (Nvidia, Apple, Amazon, Meta, Tesla, Microsoft and Alphabet).

Morningstar research shows that in 2024, 55% of the US’s total market gains came from just eight stocks –the M7 plus semiconductor manufacturer Broadcom; and “these same companies contributed 53% of total market gains in 2023”.

Flocking to global growth trusts

UK investors have unsurprisingly been hungry for a piece of the M7 action. In the investment trust arena, broker best buy lists such as that of interactive investor show they are flocking to global growth trusts. These portfolios are often heavily skewed towards US tech stocks, so investors are getting the M7 exposure they seek – though many might be surprised at what a major role the fortunes of a few richly valued stocks are playing in their finances.

However, many commentators believe that after such a strong run, it may be difficult for the M7 to continue building so impressively on the gains of recent years in the near term. So far this year, the M7 have suffered several wobbles and to date (14 February) have returned only 1.6%, compared with the wider S&P 500’s 4%.

As a recent article from research company QuotedData puts it: “The problem is not that these are suddenly bad companies. It is simply that they were priced for perfection and concentration had become

extreme. The S&P 500 now has 36% of its market capitalisation in its top 10 stocks.”

But technology is a growing part of everyday life in the 21st century; so how can growth investors tap into the long-term opportunities afforded by this fast-moving sector, while avoiding the temptation to overload on a narrow basket of highly priced and potentially volatile American stocks?

Entrepreneurial Asia

One attractive option is to diversify their portfolio by hunting out growth-oriented investments with a different geographical focus - entrepreneurial Asia being an obvious part of the world to consider.

The £900 million+ Schroder AsiaPacific Fund (SDP) provides broad-based and diversified exposure to this rapidly evolving region. It does this through a concentrated 60-stock basket of high-quality but attractively valued Asian companies, with regional technology holdings playing a key role.

Indeed, SDP’s largest sector by value is technology, accounting for a third of the portfolio – notably more than the trust’s benchmark MSCI Asia ex Japan index.

By country, the dynamic tech hub of Taiwan – a global leader in the semiconductor industry – leads the pack, with almost a quarter of the fund invested there as at the end of January 2024.

Some of the strongest global tech performances last year came from high-performance semiconductor companies, driven by burgeoning global demand for

AI, 5G cloud computing and digitisation.

SDP was well positioned in this regard, with holdings in Taiwanese manufacturers such as the world leader Taiwan Semiconductor (TSMC)* and design companies such as MediaTek* providing an exciting play on the crucial supply chains underpinning these powerful trends.

But the trust also has holdings across a wide range of technology businesses, and in electronics companies such as Samsung Electronics* and Delta Electronics*, as well as regional digital giants like Tencent*, Alibaba* and NetEase*.

Valuations remain relatively attractive

Crucially, given SDP’s focus on quality at a reasonable price, the valuations of Asian IT companies remain relatively attractive, certainly compared with their US competitors.

SDP’s extensive Asia-based network extends to more than 40 highly experienced company analysts in offices throughout the region, who between them meet with and assess a huge number of regional businesses each year.

It could therefore be seen as a neat way to access a careful selection of market-leading tech companies, without the typical bias to the pricey US tech giants that comes with global investment trusts.

That makes it a natural diversifier for any investor keen to build a more robust growth portfolio with exposure to some of the world’s largest and most dynamic markets.

Certainly, its recent performance record is impressive in absolute terms, after several challenging years when rampant inflation made life very difficult for growth-focused investments.

Over the year to end January, SDP achieved a share price return of 19% and the value of the companies in its portfolio rose by 22% – more or less in line with the benchmark index.

But on a longer perspective – five or 10 years – both share price and net asset value have significantly outpaced the benchmark. Given this focus on fastmoving industries within a rapidly evolving part of the world, it’s really important that investors are able to take such a long-term perspective on their investments. (Past performance is not a guide to future performance and may not be repeated).

That’s where the annual tax-free SIPP and ISA

allowances play such a valuable role, as funds and trusts held through these accounts can grow free of tax on both dividend income and capital gains over the coming years and decades.

There’s no doubt that an informed focus on technology is a hugely exciting prospect if you’re able to take the long view – and a foray into the Asian market could prove an attractive and well-priced diversifier from US exposure.

[*] – Reference to stocks are for illustrative purposes only and are not a recommendation to buy or sell.

The value of tax reliefs depends on financial circumstances.

We recommend you seek financial advice from an Independent Adviser before making an investment decision. If you don’t already have an Adviser, you can find one at www.unbiased.co.uk or www.vouchedfor.co.uk. Before investing in an Investment Trust, refer to the prospectus, the latest Key Information Document (KID) and Key Features Document (KFD) at www.schroders.com/sdp For help in understanding any terms used, please visit address https://www.schroders.com/en-gb/uk/individual/ glossary/

IMPORTANT INFORMATION

This communication is marketing material. The views and opinions contained herein are those of the named author(s) on this page, and may not necessarily represent views expressed or reflected in other Schroders communications, strategies or funds.

This document is intended to be for information purposes only and it is not intended as promotional material in any respect. The material is not intended as an offer or solicitation for the purchase or sale of any financial instrument. The material is not intended to provide, and should not be relied on for, accounting, legal or tax advice, or investment recommendations. Information herein is believed to be reliable but Schroder Investment Management Ltd (Schroders) does not warrant its completeness or accuracy.

The data has been sourced by Schroders and should be independently verified before further publication or use. No responsibility can be accepted for error of fact or opinion. This does not exclude or restrict any duty or liability that Schroders has to its customers under the Financial Services and Markets Act 2000 (as amended from time to time)

or any other regulatory system. Reliance should not be placed on the views and information in the document when taking individual investment and/or strategic decisions.

Past Performance is not a guide to future performance.

The value of investments and the income from them may go down as well as up and investors may not get back the amounts originally invested. Exchange rate changes may cause the value of any overseas investments to rise or fall.

Any sectors, securities, regions or countries shown above are for illustrative purposes only and are not to be considered a recommendation to buy or sell.

The forecasts included should not be relied upon, are not guaranteed and are provided only as at the date of issue. Our forecasts are based on our own assumptions which may change. Forecasts and assumptions may be affected by external economic or other factors.

Issued by Schroder Unit Trusts Limited, 1 London Wall Place, London EC2Y 5AU. Registered Number 4191730 England. Authorised and regulated by the Financial Conduct Authority.

Are ISA investors more adventurous than SIPP investors?

The picture implied by the data might surprise you

On paper, you might think ISA investors are likely to be more risktolerant than SIPP investors.

After all, if you own a SIPP you are actually managing your own pension so surely you aren’t going to take big risks with your financial future?

On the other hand, ISAs are a good way to shelter capital gains from the tax man so if you have an ISA you are probably more likely to ‘swing for the fence’ as they say in baseball in the hope of netting big returns.

In fact, judging by some of the most popular holdings on the AJ Bell platform – which excludes AJ Bell funds – investors in SIPPs and ISAs have a lot more in common than you might think.

SURPRISINGLY SIMILAR

Contrary to expectations, ISA investors don’t appear to be big risk-takers, nor are all SIPP investors stick-in-the muds.

There is a great deal of cross-over between many of the most popular holdings across both groups of investors, with no fewer seven funds or stocks appearing on both lists.

It would appear ISA and SIPP investors are equally keen on Baillie-Gifford-run investment trust Scottish Mortgage (SMT) and Terry Smith-steered fund Fundsmith Equity (B41YBW7). Interestingly, among the usual big dividend-

paying SIPP stocks like Aviva (AV.), BP (BP.), GSK (GSK) and Shell (SHEL), one name stands out like a sore thumb – AI chipmaker and all-round tech favourite Nvidia (NVDA:NASDAQ).

If anything, ISA investors seem content to take a more broad-brush approach to investing, with two S&P 500 tracker funds on the list alongside Fidelity Index World (BJS8SJ3) and a LifeStrategy fund from US firm Vanguard, whereas SIPP investors seem to prefer individual stocks.

THE FOLLY OF YOUTH?

If ISA and SIPP investors think along the same lines, are there any marked differences of opinion between say older and younger ISA investors?

This time there are, but again the answer isn’t necessarily what you might expect.

Younger people have more time to amass a ‘pot’, so you might think they would take a more ‘risk-on’ attitude and make quite concentrated bets, whereas older investors are likely to want to protect their capital so they will spread their bets.

In fact, almost the opposite is true – younger investors are more likely to invest in funds and spread their risk, while older investors prefer individual stocks.

AJ Bell investment analyst Dan Coatsworth believes there’s a logic to this, as younger, less experienced investors might lack the time, expertise or confidence to research individual

stocks and prefer to get instant diversification through funds.

‘Global equity funds are popular among those aged 18 to 30 as they provide exposure to companies around the world at the click of a button,’ explains Coatsworth.

Once this cohort move on into their 30s and 40s, it’s reasonable to expect them to be moving up the career ladder and potentially having more money to invest.

This is where risk-taking begins to manifest itself, as with time on their side and decades to go to retirement many are happy to seek higher-risk investments such as in the tech space where they might be up to speed with the latest innovations.

US tracker funds are also popular among this age group, as America is the land of mega-cap tech firms.

AGE AND EXPERIENCE

‘Those in their 50s are typically better-placed financially – they may be in the final phase of paying off their mortgage, or they are earning a decent crust which covers all the bills and leaves plenty left over to invest,’ observes Coatsworth.

Funds are still popular with this age group but it’s common to see individual tech stocks such as Nvidia ranking on a par with blue-chip dividend payers like Lloyds (LLOY).

It’s towards their late 50s, when they start to think about retirement coming around the corner, that investors typically start to think about derisking their portfolios.

The transition to a more stockheavy ISA is clear once you look at the 60+ age group, flags Coatsworth, with large-cap income stocks such as GSK and Legal & General (LGEN) featuring regularly.

Example of top holdings

Popular ISA Holdings Popular SIPP Holdings

Scottish Mortgage

Scottish Mortgage

Fidelity Index World Fundsmith Equity

Fundsmith Equity Legal & General

Legal & General

Fidelity Index World

Vanguard S&P 500 ETF Lloyds

Lloyds Nvidia

iShares S&P 500 BP

Nvidia GSK

BP Shell

Vanguard LifeStrategy 100% Equity Aviva

have shown a preference towards ones with more familiar assets in their portfolio.

Names like JPMorgan Global Growth & Income (JGGI) and City of London Investment Trust (CTY) feature heavily in ISAs for this age group, as their portfolios are full of big, well-known companies.

Interestingly, stocks are still the most popular asset among ISA investors in their 80s, 90s and older.

Global equity funds are popular among those aged 18 to 30”

‘Older people might feel these are trusted names that have been around for years and are the type of company which won’t disappear in a puff of smoke.’

Investment trusts are popular among those in their 70s and older, with a particular bias towards those with an equity income focus.

Whereas high yields are widely available among more niche investment trusts, such as renewable energy or debt vehicles, older AJ Bell investors

‘You might think people of this age are heavily invested in bonds, but that’s often not the case, unless they’ve chosen to hold fixed income investments in a pension and are using an ISA for higher-risk equity exposure,’ concludes Coatsworth.

Disclaimer: AJ Bell referenced in this article, own Shares magazine. The author (Ian Conway) and editor (Tom Sieber) of this article own shares in AJ Bell.

By Ian Conway Deputy Editor

Table: Shares magazine • Source: AJ Bell, March 2025

POWERED BY PERSPECTIVE PERFORMANCE

Left: Alexandra, Head of Client Services

Right: Adam, Wealth - London Team Lead

What does gold see that equities and bonds do not?

There is a risk the US resorts to extreme measures to solve the deficit

Stock, bond, currency and commodity markets continue to try and second-guess the implications of president Trump’s trade and tariff policies.

It’s hard to be dogmatic – which may be part of the problem – but all we can probably say with any certainty is 2024’s surge in US equity valuations reflected the view that inflation would cool, interest rates would fall and growth would be steady in 2025 and beyond.

However, Trump’s initial tariff moves in his second term are shaking faith in that rosy trifecta: inflation could be higher, interest rates may fall more slowly than expected and the growth outlook is less clear.

Anything in terms of tariff deals or concessions which gets the world back on track toward lower inflation, lower rates and steady growth is therefore likely to be seen as a good thing for share prices and anything that takes them further away may be taken badly by equity investors.

The fixed-income markets may have a different view, however, and it is here that Trump and treasury secretary Scott Bessent may be focusing their attention.

Thus far, Trump seems impervious to stock market volatility, in contrast to his first term, and willing to embrace some near-term pain in exchange for what he views as the long-term gain – higher revenues from tariffs, more jobs on US soil and higher growth with, further down the road, perhaps the chance to cut income tax as a result.

Bessent seems equally determined, judging by his televised comments about the need for America’s economy and companies to wean themselves off

their addiction to government spending.

Whether we agree with them or not, therefore, it may pay to judge the efficacy of the White House’s policies through the prism of the US government bond or treasury market, rather than via the S&P 500, Dow Jones or NASDAQ Composite equity indices.

SCARY NUMBERS

Bessent appears concerned by four, interconnected, issues.

Federal borrowing has continued to soar. At the end of 2024 it stood at a record $36.2 trillion, and the Congressional Budget Office’s January estimates suggested it will grow by $22.1 trillion in the next 10 years.

The interest bill has therefore shot up to an annualised rate of $1.1 trillion, or a fifth of America’s taxation income. That is forcing

Trump seems impervious to stock market volatility”

The US federal deficit continues to soar

the discussion about federal spending cuts and increasing revenue from tariffs (among other sources).

The average interest rate on the US federal debt is 3.27%, but the benchmark two- and 10-year Treasuries yield 4% and 4.37% respectively, at the time of writing. Any new issuance is thus going to be more expensive, as is replacing and refinancing existing paper. The bad news here is the profile is very short, with half of the publicly-held debt due to mature in the next three years.

This may be why 10-year yields are refusing to go down, even as the US Federal Reserve cuts headline borrowing costs – the ‘bond vigilantes’ are looking at the amount of paper coming their way from new paper to cover both fresh borrowing and refinanced debt.

US benchmark treasury yields are ignoring Fed rate cuts

US benchmark treasury yields are ignoring Fed rate cuts

Tough talk is helping to anchor US treasury yields

YIELD TO PRESSURE

These numbers focus the mind and mean America must at least make a good show of tackling the national debt.

Otherwise, the cost of borrowing could soar, meaning the interest bills either become so crushing they hobble the economy, or the US has to print its way out of trouble so it can pay, with all of the inflationary implications that has, even for the globe’s reserve currency.

This is also at a time when the US economy is growing – an unexpected recession would hit tax income, increase welfare spending, and make things look even worse.

Again, in this context it is easy to see why Trump and Bessent are focused on the bond market, not the stock market, because the stakes are potentially very high.

At least they can draw some comfort from how the 10-year yield is no higher now than when Trump prevailed in the 2024 election, in contrast to the trends evident elsewhere.

But the danger is the sort of austerity promised

Money & Markets podcast

by the Department of Government Efficiency’s spending cuts leads to the slowdown or recession that simply blows up the numbers, or at least forces some more highly unorthodox policies.

And that could just be why gold continues to march higher, seemingly in lockstep with the US deficit, as investors seek a bolthole just in case something really unusual develops.

Gold seems to be pricing in an unorthodox solution to any debt drama

Fidelity China Special Situations PLC

An AJ Bell Select List Investment Trust

If you want to take full advantage of the incredible growth of China’s middle classes and a seismic shift towards domestic consumption, you need real on-the-ground expertise.

Fidelity China Special Situations PLC, the UK’s largest China investment trust, looks to capitalise on an extensive, locally based analyst team to make site visits and attend company meetings. This helps us find the opportunities that make the most of the immense shifts in local consumer demand.

China’s growth story

Since its launch in 2010, the trust has offered direct exposure to China’s growth story; from tech giants right the way through to entrepreneurial medium and small-sized companies, and even new businesses which are yet to launch on the stock market. Portfolio manager Dale Nicholls looks to identify and invest in companies that are best placed to capitalise on China’s incredible transformation.

Past performance

Investing in China’s most compelling growth drivers Dale believes a vast and still expanding middle class is increasingly driving stock market returns in China.

“China is well established now as a major driver of growth and investment performance, not just in Asia, but in the wider world. The sheer size of China’s economy, its continued growth and ever-increasing global importance, should see investors increase their exposure to China as part of a balanced investment portfolio.”

Past performance is not a reliable indicator of future returns.

Past performance is not a reliable indicator of future returns

Source: Morningstar as at 28.02.2025, bid-bid, net income reinvested. ©2025 Morningstar Inc. All rights reserved. The FTSE All Share Index is a comparative index of the investment trust

Source: Morningstar as at 28.02.2025, bid-bid, net income reinvested. ©2025 Morningstar Inc. All rights reserved. The MSCI China Index is a comparative index of the investment trust.

Important information

The value of investments can go down as well as up and you may not get back the amount you invested. Overseas investments are subject to currency fluctuations. Investments in emerging markets can be more volatile than other more developed markets. The trust invests more heavily than others in smaller companies, which can carry a higher risk because their share prices may be more volatile than those of larger companies. The shares in the investment trust are listed on the London Stock Exchange and their price is affected by supply and demand. The Trust can use financial derivative instruments for investment purposes, which may expose it to a higher degree of risk and can cause investments to experience larger than average price fluctuations. The investment trust can gain additional exposure to the market, known as gearing, potentially increasing volatility. This information is not a personal recommendation for any particular investment. If you are unsure about the suitability of an investment you should speak to an authorised financial adviser.

The latest annual reports, key information documents (KID) and factsheets can be obtained from our website at www.fidelity.co.uk/its or by calling 0800 41 41 10. The full prospectus may also be obtained from Fidelity. The Alternative Investment Fund Manager (AIFM) of Fidelity Investment Trusts is FIL

(UK)

Issued by FIL Investment Services (UK) Ltd, authorised and regulated by the

the Fidelity International logo and F symbol are trademarks of FIL

How much extra you’re paying HMRC thanks to frozen income tax bands

people’s pockets.

The chancellor’s Spring Statement has thrown a spotlight on a growing problem for workers: higher taxes.

According to new figures from the Office for Budget Responsibility (OBR), we’re looking at the highest tax take relative to the economy since World War II.

The Government’s own numbers show that in just the next year, the nation’s income tax bills are set to climb nearly 11%.

In real terms, this means that in 2024/25, the nation will be shelling out a massive £260.3 billion in income tax, but it doesn’t stop there.

By 2027/28, we’re looking at a staggering £310 billion in income tax, with the OBR predicting that tax as a share of the economy will hit 37.7%.

Instead, it’s staying at £50,270, which means The Government is stealthily raising money without increasing taxes directly

WHY ARE TAX BILLS RISING?

The main reason behind this rise is the government’s decision to freeze income tax thresholds.

This freeze, brought in under the Conservatives, combined with rising wages is pushing more people into higher tax bands.

Basically, as people earn more, they’re getting taxed more because their income is moving into higher brackets.

It’s like a stealth tax hike that isn’t technically an increase in the rate itself, but it’s still hitting

If income tax bands had kept up with inflation, people would be paying less in tax because more of their income would have been shielded by the tax-free allowance.

THE BIG FREEZE AND ITS IMPACT

The freeze on tax bands is having a real impact on people’s wallets.

For example, the personal allowance, the amount you can earn before you start paying tax, would have been £16,385 by the end of the freeze in 2027/28 if it had kept pace with inflation.

Instead, it’s stuck at £12,570. That’s nearly £4,000 less that’s being protected from tax.

As for the higher-rate threshold, it would have been over £65,500 by 2027/28 if it had risen with inflation.

How much the tax freeze has cost different earners - 2021 to 2028

Salary at start of 2021/22 tax year

Total tax due with frozen allowances (from 2021/22 to 2027/28)

Total tax due with inflation-linked allowances (from 2021/22 to 2027/28)

Extra tax due under income tax threshold freeze

more people earning just a bit more will find themselves paying higher taxes on a larger chunk of their income.

WAGE GROWTH AND MORE TAXES

The OBR has also raised its forecast for wage growth, which sounds like good news for workers if bigger paychecks are coming.

But there’s a catch – when wages go up, so does the tax bill, because more of that extra income gets taxed at higher rates.

The OBR now expects the Treasury to rake in an extra £49 billion in income tax and national insurance receipts across the period to the end of the current parliament thanks to wage increases.

THE POLITICAL TWIST

Here’s where things get tricky. Labour promised not to raise income tax rates in their manifesto, and technically, they haven’t.

However, by continuing the freeze on tax bands, they’ve effectively increased the amount people are paying in tax without officially raising the rate.

It’s a bit of a loophole, and it means workers will still see their tax bills go up even though there’s been no official rate hike.

For example, someone who is a basic-rate taxpayer will pay almost £3,000 more in tax over the period of the freeze, assuming average wage

increases.

That’s because without the freeze, their taxfree allowance would have shielded more of their earnings from tax, but with the freeze, more of their pay gets hit with a 20% tax rate.

For people earning £50,000 or more, the impact is even worse. Wage growth pushes their income into the higher 40% tax band, meaning they’ll pay almost £15,000 more in tax over the course of the freeze. It’s a hefty price to pay for a pay rise.

A FAINT GLIMMER OF HOPE

Looking ahead, there’s some relief in sight, kind of. Government forecasts suggest the overall tax bill will keep climbing and hit £322 billion by 2029/30.

However, once the freeze on income tax bands ends, the tax burden as a share of the economy is expected to drop slightly since people will be able to earn more before getting taxed at higher rates.

But, even when the freeze ends, the damage has already been done. The years of frozen tax bands mean workers have been paying more tax than they would have otherwise, and that’s something that won’t be easily undone.

By Laura Suter AJ Bell Head of Personal Finance

Table: Shares magazine • Source: AJ Bell. Income tax threshold growth based on inflation rate taken from March 2024 OBR report based on actual CPI figures for all available and then forecasts for future years. Figures assume average wage growth -- based on actual figures for current years and for future years are based on forecasts taken from March 2025 OBR report.

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How do I go about taking a lump sum from my SIPP?

Helping with the process of taking cash out of a pension pot

I have a question about taking a lump sum from a SIPP. Mine is fully invested, so obviously there’s no cash available immediately to pay a lump sum and the total value of the fund is changing daily, so my question is: how would you decide what the maximum lump sum is that I could take, given the continuously changing value of the fund, and how long after that assessment would I have to realise investments in order to pay that maximum lump sum?

Shaun Rachel Vahey, AJ Bell Head of Public Policy, says:

One of the biggest tax advantages of pensions is the ability to take up to 25% of the fund as a taxfree lump sum. From the age of 55 (rising to 57 from April 2028) you can usually take up to 25% as a tax-free lump sum (as long as you haven’t gone over a total limit of £268,275 which applies across all your pension pots). You could then use the rest of the pot to buy an annuity – which pays a guaranteed income throughout your life – or keep the rest invested in drawdown and take an income from it when you need and want to. This could be a regular income or one-off withdrawals.

Any income you take from the pension pot is added to other income – for example from earnings or state pension – and will be subject to income tax.

The 25% tax-free amount is obviously a big tax perk. But if you don’t need the money then it may just sit in your bank account and could potentially be subject to inheritance tax when you die if you haven’t used it.

But if you have decided to take some or all your tax-free cash – maybe to pay some debt or an expense such as a house renovation – then you will want to think about timing.

The ‘techie’ answer to your question is that

the value of the maximum lump sum is set at the RBCE (relevant benefit crystallisation event). (This is the point the lump sum is measured to compare against that £268,275 limit – the lump sum allowance or LSA for short.) At that point the valuation is locked in. You will probably need to check with your pension provider when they set the RBCE; many will use the date they receive the request to take benefits.

SELLING DOWN INVESTMENTS

You will then have to sell down investments to make sure you have enough cash to pay the lump sum, or your pension provider might automatically do that for you when they receive the request.

It’s possible the value of your pension fund will change between you making the request to take cash and the cash being paid out. What happens then depends on your pension provider. It’s likely the value of your tax-free cash won’t change, after the RBCE has been locked in. So even if the value of the pot goes up or down, it’s just the amount of

Ask Rachel: Your retirement questions answered money in drawdown that will change, not the taxfree cash amount.

The value of your pension fund may change between your cash request and payout. This depends on your provider. Typically, the tax-free amount remains fixed after the RBCE is locked in, so only the drawdown amount may vary with changes in the fund’s value.

One way to avoid these possible fluctuations is to sell down investments gradually to move the amount you want to take as tax-free lump sum into cash. That way you have the right amount of money in cash on the date you put in your request.

WORTH CHECKING ON THE STATUS OF WORKPLACE PENSIONS

One other thing to note. Workplace pensions may automatically shift investments to less volatile ones as you age. This is called lifestyling. Before 2015, this change often prepared members for buying an annuity by gradually moving investments in bonds and cash as their retirement age (or state pension

age) drew near.

But given that now most people with a pension pot of over £30,000 move into drawdown, therefore keeping most of their pension pot invested, this automatic move may not suit your investment strategy.

For that reason, it’s worth just checking what happens to your investments in any workplace pension in the run up to your retirement or state pension age.

DO YOU HAVE A QUESTION ON RETIREMENT ISSUES?

Send an email to askrachel@ajbell.co.uk with the words ‘Retirement question’ in the subject line. We’ll do our best to respond in a future edition of Shares. Please note, we only provide information and we do not provide financial advice. If you’re unsure please consult a suitably qualified financial adviser. We cannot comment on individual investment portfolios.

Looking for investment ideas? Register today

29 April 2025 – 18.00

Companies presenting

EJF Investments

A closed-end fund that trades on the Specialist Fund Segment of the Main Market of London Stock Exchange. EJFI’s objective is to provide shareholders with attractive risk adjusted returns through regular dividends and capital growth over the long term.

JPMorgan Emerging Markets

They seek to uncover quality stocks from across emerging markets that are also attractively valued, benefiting from an extensive network of country and sector specialists from one of the longest established emerging market teams in the industry.

North American Income Trust

NAIT aims to invest in US companies that are either producing income today or growing for income tomorrow.

Strategic Equity Capital

A specialist alternative equity trust. Actively managed by Ken Wotton and the Gresham House UK equity team, it maintains a highly-concentrated portfolio of 15-25 high-quality, dynamic, UK smaller companies, offering structural growth opportunities.

WHO WE ARE

EDITOR: Tom Sieber @SharesMagTom

DEPUTY EDITOR: Ian Conway @SharesMagIan

NEWS EDITOR: Steven Frazer @SharesMagSteve

FUNDS AND INVESTMENT

TRUSTS EDITOR: James Crux @SharesMagJames

EDUCATION EDITOR: Martin Gamble @Chilligg

INVESTMENT WRITER: Sabuhi Gard @sharesmagsabuhi

CONTRIBUTORS:

Dan Coatsworth

Danni Hewson

Laith Khalaf

Laura Suter

Rachel Vahey

Russ Mould

Shares magazine is published weekly every Thursday (50 times per year) by AJ Bell Media Limited, 49 Southwark Bridge Road, London, SE1 9HH. Company Registration No: 3733852.

All Shares material is copyright. Reproduction in whole or part is not permitted without written permission from the editor.

Shares publishes information and ideas which are of interest to investors. It does not provide advice in relation to investments or any other financial matters. Comments published in Shares must not be relied upon by readers when they make their investment decisions. Investors who require advice should consult a properly qualified independent adviser. Shares, its staff and AJ Bell Media Limited do not, under any circumstances, accept liability for losses suffered by readers as a result of their investment decisions.

Members of staff of Shares may hold shares in companies mentioned in the magazine. This could create a conflict of interests. Where such a conflict exists it will be disclosed. Shares adheres to a strict code of conduct for reporters, as set out below.

1. In keeping with the existing practice, reporters who intend to write about any securities, derivatives or positions with spread betting organisations that they have an interest in should first clear their writing with the editor. If the editor agrees that the

reporter can write about the interest, it should be disclosed to readers at the end of the story. Holdings by third parties including families, trusts, selfselect pension funds, self select ISAs and PEPs and nominee accounts are included in such interests.

2. Reporters will inform the editor on any occasion that they transact shares, derivatives or spread betting positions. This will overcome situations when the interests they are considering might conflict with reports by other writers in the magazine. This notification should be confirmed by e-mail.

3. Reporters are required to hold a full personal interest register. The whereabouts of this register should be revealed to the editor.

4. A reporter should not have made a transaction of shares, derivatives or spread betting positions for 30 days before the publication of an article that mentions such interest. Reporters who have an interest in a company they have written about should not transact the shares within 30 days after the on-sale date of the magazine.

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