HICL INFRASTRUCTURE

MarcoM

Hello, does anyone on these boards have this as an investment?
I have about 10k worth of this and it has dropped no end over the past year.
Would people consider buying more?

eskbanker

MarcoM said:

it has dropped no end over the past year

It's dropped by less than 30%, which isn't really 'no end' as such, as individual shares can and do drop by substantially more than that!  What led you to buy in the first place, and (other than subsequent performance) what's changed?

Prism

I first bought it when it dropped in March 2020 - it is around 20% down from that level now, almost all down to the trusts discount. I have added to that once, last year. It hasn't grown the dividend recently but has 12 years of revenue reserves to pay for future dividends. NAV has risen steadily over the years.

I think of it as one on my safest trusts and have no intention of selling it, even with the losses so far. Would certainly buy some more.

MarcoM

eskbanker said:

MarcoM said:

it has dropped no end over the past year

It's dropped by less than 30%, which isn't really 'no end' as such, as individual shares can and do drop by substantially more than that!  What led you to buy in the first place, and (other than subsequent performance) what's changed?

bought it for income

Malthusian

It's paying the same income it has since at least 2019, so it still seems to be doing the job you bought it to do.

coastline

Price sensitive to higher interest rates I would think. ? You can get a return on cash of 5% ATM but still below inflation ( well for now lets see next year ?) Yields are falling today a fair bit so probably why HICL is also up today.

United Kingdom Government Bond 10Y - 2023 Data - 1980-2022 Historical - 2024 Forecast (tradingeconomics.com)

VGOV and HICL together.

Vanguard UK Gilt UCITS ETF, UK:VGOV Advanced Chart - (LON) UK:VGOV, Vanguard UK Gilt UCITS ETF Stock Price - BigCharts.com (marketwatch.com)

Albermarle

I bought it as a way of diversifying my portfolio from the usual equity/bonds/cash.
It did a good job of holding up in the general downturn in the first half of 2022, but has since been badly affected by the surge in interest rates. 
Nearly all the loss has come from the discount going for zero to 27%, so I suppose that means in theory it could bounce back quite quickly if interest rates start to fall ( optimistic hat on !) 

MarcoM

Albermarle said:

I bought it as a way of diversifying my portfolio from the usual equity/bonds/cash.
It did a good job of holding up in the general downturn in the first half of 2022, but has since been badly affected by the surge in interest rates. 
Nearly all the loss has come from the discount going for zero to 27%, so I suppose that means in theory it could bounce back quite quickly if interest rates start to fall ( optimistic hat on !) 

would you consider buying more?

wmb194

MarcoM said:

Albermarle said:

I bought it as a way of diversifying my portfolio from the usual equity/bonds/cash.
It did a good job of holding up in the general downturn in the first half of 2022, but has since been badly affected by the surge in interest rates. 
Nearly all the loss has come from the discount going for zero to 27%, so I suppose that means in theory it could bounce back quite quickly if interest rates start to fall ( optimistic hat on !) 

would you consider buying more?

I'm sure there was a more recent one that I cannot find but CityWire often mentions HICL in its articles. Apparently some directors have been buying and, for what it's worth, there are some analysts who like it. It goes ex-dividend tomorrow, 2.06p, so you might see a slight dip.

https://citywire.com/investment-trust-insider/news/hicl-directors-buy-their-infrastructure-fund-s-cheap-shares-before-agm/a2422101

https://citywire.com/investment-trust-insider/search?q=Hicl

https://www.marketscreener.com/quote/stock/HICL-INFRASTRUCTURE-PLC-57086012/consensus/

Albermarle

MarcoM said:

Albermarle said:

I bought it as a way of diversifying my portfolio from the usual equity/bonds/cash.
It did a good job of holding up in the general downturn in the first half of 2022, but has since been badly affected by the surge in interest rates. 
Nearly all the loss has come from the discount going for zero to 27%, so I suppose that means in theory it could bounce back quite quickly if interest rates start to fall ( optimistic hat on !) 

would you consider buying more?

No, as I decided to have a couple of infrastructure funds for diversity ( the other one has gone down as well) and not for short term speculation. However I am not pulling out either.