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Temple Bar applauded for sticking with value

Temple Bar applauded for sticking with value as Alastair Mundy exits and RWC takes over

By Jessica Tasman-Jones, 23 Sep 20

Ninety One reportedly had high hopes of keeping mandate despite star manager leaving for teaching career

The board of the Temple Bar investment trust have been applauded for sticking with unloved value as it hands the £430m mandate to RWC duo Nick Purves and Ian Lance following Alastair Mundy’s exit from fund management to pursue a teaching career.

RWC is expected to take on the investment trust from October, despite the notice period for Ninety One ending in April 2021, but will waive fees until 30 June 2021 so that shareholders are not double charged. Fees will remain unchanged at 0.35% of gross asset value.

The investment trust also announced the dividend had been cut 25% to 38.5p, representing a yield of 5.9% based on its closing price on Tuesday…

The trust currently trades at a discount of 12.6%, according to Hargreaves Lansdown data. Numis was disappointed the Temple Bar board did not mention discount control measures in the investment manager update.

Board applauded for sticking to its guns as number of value strategies decreases

Numis added that the number of value-focused investment trusts had been decreasing over time and that it would have been a “difficult” decision for the board to stick by the underperforming style Mundy had employed rather than chasing the performance of growth managers…

RWC duo not as ‘dogmatic’ in their approach to value

In a paid piece of research with QuotedData, Purves and Lance named Royal Mail, Dixons Carphone and ITV as stocks they were considering for inclusion in the Temple Bar portfolio. The research note said the pair currently saw “extreme value” in financials, particularly banks and insurers, oil and gas majors, consumer discretionary, such as retailers, media, support services and telecoms, and some companies within the materials sector.

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