Liontrust Global Dividend Fund

March 2020 review

The Fund returned -6.7% in March*, compared with -10.9% from the MSCI AC World Index and -11.6% from the IA Global Equity Income sector.

The portfolio has continued to hold up well in the sell-off, thanks largely to our exposure to companies with both strong balance sheets and pricing power, both of which are critical as the global economy went into lockdown.

As we enter the next phase of this crisis, the real economy is starting to show signs of strain with many companies rushing to scrap shareholder pay-outs on concern over the economic impact of the health crisis.

So far, at least 80 companies in the Stoxx 600 Index have cancelled or delayed their dividends – in particular, companies with weak balance sheets exposed to liquidity concerns. Therefore, we anticipate the focus to shift from dividend omissions to equity raises. Only one holding, Rightmove, has cut or removed its dividend. Still, we see this as an exception rather than a trend as we invest in well-capitalised companies with strong market positions and the ability to withstand the impending demand shocks. 

 

We continue to remain optimistic about our portfolio holdings ability not only to return capital to shareholders but also grow the income distribution to investors this year. We remain fully invested and have started to see pockets of opportunity appear in our universe of Global Leaders after the sudden sell-off.


Discrete years' performance** (%), to previous quarter-end:


 

Mar-20

Mar-19

Mar-18

Mar-17

Mar-16

Liontrust Global Dividend C Acc GBP

5.0

15.6

-1.0

14.6

-6.9

MSCI AC World

-6.7

10.5

2.4

32.2

-1.2

IA Global Equity Income

-9.8

8.5

-1.4

25.4

-1.8

Quartile

1

1

2

4

4

 

*Source: Financial Express, as at 31.03.2020, total return (net of fees and income reinvested). Non fund-related return data sourced from Bloomberg.

 

**Source: Financial Express, as at 31.03.2020, total return (net of fees and income reinvested) primary class.

 

For a comprehensive list of common financial words and terms, see our glossary here.

 

Key Risks

Past performance is not a guide to future performance. Do remember that the value of an investment and the income generated from them can fall as well as rise and is not guaranteed, therefore, you may not get back the amount originally invested and potentially risk total loss of capital. Investment in funds managed by the Global Equity (GE) team may involve investment in smaller companies - these stocks may be less liquid and the price swings greater than those in, for example, larger companies. Investment in funds managed by the GE team may involve foreign currencies and may be subject to fluctuations in value due to movements in exchange rates. The team may invest in emerging markets/soft currencies or in financial derivative instruments, both of which may have the effect of increasing volatility. Some of the funds managed by the GE team hold a concentrated portfolio of stocks, meaning that if the price of one of these stocks should move significantly, this may have a notable effect on the value of that portfolio.

Disclaimer

The information and opinions provided should not be construed as advice for investment in any product or security mentioned, an offer to buy or sell units/shares of Funds mentioned, or a solicitation to purchase securities in any company or investment product. Always research your own investments and (if you are not a professional or a financial adviser) consult suitability with a regulated financial adviser before investing.

Friday, April 17, 2020, 4:26 PM