City of London IT

MarcoM

Hi,

This IT is suffering constant drops over the past few weeks, like everything else I guess.
What are other holders doing? Are you buying more or have concerns for the future of this investment?
I have quite a considerable amount into this.
Thoughts?

Regards

JohnWinder

The KID says: ‘ The risk indicator assumes that you keep the product for 5 years.’
If you’ve had it less than five years you should hold it; if longer than five years you have a harder decision.

ColdIron

As you say, "like everything else I guess"

If you look at the price since 2021 it's trading within its expected range, I'm quite comfortable with it. There are other investments that are faring much worse (HICL, RCP etc)

What are other holders doing?

I'm doing nothing in my SIPP or GIA. I have it for the dividend income and it's doing what it says on the tin. I am building another income portfolio in one of my ISAs for when I reach SP age when some tax free income will be welcome. CTY is about 10% of it and I'm happy to buy at the lower end of its range

wmb194

MarcoM said:

Hi,

This IT is suffering constant drops over the past few weeks, like everything else I guess.
What are other holders doing? Are you buying more or have concerns for the future of this investment?
I have quite a considerable amount into this.
Thoughts?

Regards

Essentially it tracks the FTSE100. What did you do a year or so ago when it was last at these levels? I guess it'll depend on whether you think the FTSE100 is good value or not and a lot of people* think it is. Then again, they've been saying this for a long time.

*Analysts, the talking heads on Bloomberg and CNBC.

I haven't set it up very well but this gives the rough idea:

coastline

Agree with above post FTSE valuations are cheap relative to US but when is the situation going to change ? That record is on repeat . Basically CTY tracks the FTSE. Could compare the top ten holdings but longer term it's not life changing.

The City of London Investment Trust Ord Fund factsheet | Trustnet

iShares plc Share Price (ISF) Core FTSE 100 UCITS ETF (Dist) | ISF (hl.co.uk)

Short term CTY has underperformed FTSE ( without dividends ) 

FTSE 100 Index, UK:UKX Advanced Chart - (FTSE UK) UK:UKX, FTSE 100 Index Stock Price - BigCharts.com (marketwatch.com)

5 years with dividends..

Chart Tool | Trustnet

With all equity investment you make it's best to keep one eye on the US markets for direction . Not that good recently.

United States Stock Market Index 500 - 2023 Data - 1928-2022 Historical (tradingeconomics.com)

TA and the tea leaves it's all oversold short term but it could be several things influencing it. Seasonality late SEPT-OCT is generally poor. There's still concerns with rates and inflation and now a crisis. With a crisis you often get straight down days/week and then stability.

City of London Investment Trust PLC, UK:CTY Advanced Chart - (LON) UK:CTY, City of London Investment Trust PLC Stock Price - BigCharts.com (marketwatch.com)

talexuser

I sold out a couple of years ago. Fine for dividends but got poorer and poorer for total return.

ColdIron

It's not a suitable investment for total return, that's not its objective

coastline

FTSE lost its way after the dotcom boom where ordinary stocks were way overvalued EG P/E over 20 and never heard of. Since then the index has paid out a rewarding dividend but many stocks have failed to contribute to growth . The link shows FTSE (Green) and FTSE WORLD ( yellow) where finally around 2015 the FTSE fails and has never recovered.

cILTsWQ.png (641×533) (imgur.com)

Nothing has changed since but you never know. Still for an income portfolio CTY and FTSE are worth a slice of the action.

Chart Tool | Trustnet

talexuser

ColdIron said:

It's not a suitable investment for total return, that's not its objective

Aye, but it wasn't even keeping up the capital.

Audaxer

I reinvested some dividends a few months ago. I don't plan to sell, but it's a relatively small percentage of my income portfolio. 

tacpot12

CTY is about 7% of my retirement portfolio and I am keeping it as it is one on my highest yeilding ITs. (5% pa over the last 5 years). The share price has dropped about 14% since I bought the shares, but my entire portfolio has dropped by 9% over the same period. I think CTY may have dropped a little more as it has been very popular for its dividend, and people may be worried about how much they have invested in it and want to diversify, or just need the money. There has been a lot of outflow from pensions over the last 18 months as people try to cope with inflation.