Average investment trust discount hits single digits
Narrowest discount since 2022.
The average investment trust discount has reached single digits for the first time in nearly four years. The average discount on 31 May 2026 was 9.6%1, the first month-end since August 2022 when it has been less than 10%.
The discount at the end of August 2022 was 9.4%.
It has been a challenging period for investment trusts, but there is light at the end of the tunnel. The sector has reshaped itself over the past four years with unprecedented levels of M&A and share buybacks, as well as mandate changes and fee cuts to give shareholders a better deal.
Richard Stone, Chief Executive of the Association of Investment Companies (AIC)
Average discounts were in double digits for a period of three years and eight months between September 2022 and April 2026. This was due to a combination of factors including higher interest rates, regulatory issues with cost disclosures, and the dominance of large US tech companies. The widest month-end discount during this period was 18.8% at the end of October 2023.
Richard Stone, Chief Executive of the Association of Investment Companies (AIC), said: “It has been a challenging period for investment trusts, but there is light at the end of the tunnel. The sector has reshaped itself over the past four years with unprecedented levels of M&A and share buybacks, as well as mandate changes and fee cuts to give shareholders a better deal.
“While the challenges are not over yet, it’s encouraging to see that the average industry discount is now back in single digits. This reflects the continuing appeal of the investment trust structure, which can offer exposure to virtually any asset from mainstream stocks and shares to exciting private companies such as SpaceX.”
Notes to editors
- Source: theaic.co.uk / Morningstar (excluding 3i and VCTs).
