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Infrastructure Trusts
Freefall Junkie
Posted: 10 March 2018 11:34:06(UTC)

Joined: 09/06/2014(UTC)
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I am looking for a bit of diversification in my portfolio which is currently mostly growth style trusts or cash. Infrastructure trusts seem to have taken a bit of a kicking recently with Carillion, Capita and the threat to PFI from Labour so I am wondering if now might be a good time to consider them. This article in particular got me thinking I wouldn't want to go near HICL because of its PFI exposure, but INPP looks very interesting. Near 5% yield, trading at a 3.8% premium compared to an average of 12% for the last year, with a chunk of its yield apparently inflation linked.

Have to confess to not knowing a great deal about the infrastructure sector so I would welcome others thoughts on this.
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Paul Gulbrandsen on 12/03/2018(UTC)
Tug Boat
Posted: 10 March 2018 12:17:58(UTC)

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I hold JLIF and SEQI, bought as diversifies. I intend to hang onto them.

Don't think commie Corbyn is anything to worry about. First he has to win an election, then get a bill through both houses and find a few hundred billion. There's no big pool of " in house" workers to do the stuff required.

Jerry is the mad uncle you see every Christmas, dreaming of the socialist utopia, which in reality is a dystopian apocalypse. Now that other one the shadow chancellor, he frightens me.
7 users thanked Tug Boat for this post.
Chris Howland on 10/03/2018(UTC), Freefall Junkie on 10/03/2018(UTC), dlp6666 on 11/03/2018(UTC), Paul Gulbrandsen on 12/03/2018(UTC), Aidan MacGinley on 12/03/2018(UTC), Mostly Retired on 13/03/2018(UTC), Andrew Smith 259 on 19/03/2018(UTC)
Mr Helpful
Posted: 10 March 2018 19:03:06(UTC)

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Have held HICL and INPP in the past, but dumped both after the Labour Conference bombshell.
Now holding just a middling amount of BBGI and 3IN.
But neither today seem bargains.
3IN in the middle of share consolidation / special distribution, so not entirely clear how the nav will settle going forward.

Check the UK weight of INPP.
Might not be quite as international as supposed.
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Freefall Junkie on 10/03/2018(UTC), Paul Gulbrandsen on 12/03/2018(UTC)
Michael Grimes
Posted: 12 March 2018 17:04:38(UTC)

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As a user of the new Mersey gateway bridge I have just been looking at the financing details and came across BBGI.

They look like a careful PPI infrastructure financer and based on their international portfolio of projects they seem unlikely to be knocked back by JC histrionics.

Reading up on their key people CV's it seems they have years of previous experience with McQuarrie.
Paul Gulbrandsen
Posted: 12 March 2018 18:09:50(UTC)

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I also read the Trustnet article with interest as an income investor. For the record I formerly held JLIF but jumped ship after the Labour bombshell. I posted about INPP just recently (What’s a [retired] man to do ...) so at the risk of repeating myself:
- income is mainly inflation linked
- relatively low exposure to PFI contracts
- latest NAV to be announced on 21 March may well be in line with the current share price

Previously I had the impression that infrastructure funds were perfect for income investors such as myself, offering an inflation linked income that was secure as it was backed by the government, but now it’s clear that there is political risk involved. However, as a previous poster pointed out, that political risk may have been overstated so I’m considering investing in INPP. Interested in others’ opinions.
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Freefall Junkie on 12/03/2018(UTC)
Tyrion Lannister
Posted: 12 March 2018 21:58:30(UTC)

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I hold EGL. Maybe I was naive, but as this is global I thought it might be sheltered from the Corbyn paranoia but how wrong I was, it’s lost 12% since I bought it late last summer.

I’m not sure I’d recommend it tbh as costs are high. It is selling at a10% discount though and at 5.5% the income is pretty good.
Joe Soap
Posted: 13 March 2018 05:49:29(UTC)

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Tyrion Lannister;58615 wrote:
I hold EGL. Maybe I was naive, but as this is global I thought it might be sheltered from the Corbyn paranoia but how wrong I was, it’s lost 12% since I bought it late last summer.

I’m not sure I’d recommend it tbh as costs are high. It is selling at a10% discount though and at 5.5% the income is pretty good.

I think EGL is a bit of a bargain presently. There seems no discernable or sensible reason why the shares have lost so much value as far I can see. The NAV is still fine. I recently bought in during the recent market wobbles to average down my buying price. I now hold too much in EGL really but it has almost nothing in the UK so I think it's time in the sun is yet to come and it will bounce back. You get a handsome dividend while you wait. Main thing I am unhappy about is the holding it has in EDF which as a business is a basket case propped up by the French government.
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Tyrion Lannister on 13/03/2018(UTC)
Mostly Retired
Posted: 13 March 2018 06:39:18(UTC)

Joined: 24/04/2012(UTC)
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Depending on one's view of the UK political risk, there is also JLIF which I hold along with 3IN.

Admittedly, the amounts relative to my overall book are small (the two together are circa 1.5% of total). However, the historic yield at over 6% may be viewed as some compensation for a degree of risk. The share price has been somewhat damaged of course falling from a 12 month average premium of 8.78% to a current discount of 3.5%, which on a bullish day could be a "buy" indicator (though I am not feeling overly bullish!)

The sabre rattling (or hammer and sickle rattling) of the "party in the wings" does give me concern, and I would not discount entirely the risk of their arriving in power with a workable majority. In spite of my natural reaction to then decamp to a different country, I suspect that the reality of power will be far different from the rhetoric and aspirations of opposition. If I am wrong, then different horizons may beckon.
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