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Weekend reading: Morningstar’s new investment trust ratings

Weekend reading

Good investment articles from around the Web.

This week saw Morningstar introduce a new ‘qualitative’ rating system for investment trusts – ranking them as Gold, Silver, or Bronze.

Its analysts have so far rated 32 of the 100 trusts in its universe, and have already highlighted their first six favourites:

  • BlackRock Smaller Companies Trust
  • BlackRock World Mining Trust
  • City of London Investment Trust
  • Murray International
  • Perpetual Income and Growth
  • Scottish Mortgage Investment Trust

You can watch a video to hear Morningstar explain its rating procedure.

I’m not mentioning this because I think the ratings will be in any way predictive. It will take many years before we can say for sure if Morningstar’s analysts got it right – and by then it will be too late to follow them.

As an investor in investment trusts, though, I’m always happy to read informed research about these companies, so equally I’m not complaining.

The real reason I’m pointing to the new ratings is I suspect we’ll be hearing a lot more about investment trusts in the 12-months leading up to the Retail Distribution Review and beyond.

Investment trusts will be on an even playing field with other kinds of funds once the payment of commission is outlawed. It could make for an interesting opportunity, which I’ll explore in a future post.

Money and investing blogs

Deal of the week: Amazon’s editors have picked their Top 50 Kindle books of 2011. I myself know half a dozen new Kindle owners after this Christmas. Might be time I investigated the case for Amazon shares!

Mainstream media money

  • Things will get worse for Europe – The Economist
  • Executive pay: Bosses under fire – The Economist
  • Seeds of a new boom for stocks – Motley Fool
  • Skyscrapers linked with impending financial crashes – BBC
  • S&P downgrades France and Austria – FT
  • Cheap shares are not a buy signal – FT
  • BRICs look nothing like a solid investment – FT
  • Investment trusts and director’s holdings – FT
  • Income tax payments reach record high – Telegraph
  • Pay tax early and you could win £100,000? – Telegraph
  • The case for corporate bond funds at 4% – Independent
  • Private investors can now buy Indian stocks – Independent
  • Summary of rising fund supermarket fees – Independent
  • You can earn £100,000 on YouTube (or self-publishing!) – Guardian

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{ 2 comments… add one and remember nothing here is personal advice }
  • 1 Alex January 14, 2012, 5:49 pm

    I think investment trust Fidelity China Special Situations PLC (FCSS) – much hyped – pays renewal commission, doesn’t it?

  • 2 The Investor January 14, 2012, 7:02 pm

    @Alex — Can’t remember, you might be right. Most don’t, however. I keep meaning to have another look at FCSS — it’s gone from the silly 10% premium to at times a similar discount, roughly. Hard not to believe Fidelity won’t throw quite a bit at it to at least close the discount, given its profile…

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