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UK Investment Trusts

  • 17-08-2021 10:39pm
    Registered Users Posts: 53 ✭✭

    I'm looking into purchasing some UK Investment Trusts, I already have a selection of individual shares / stocks via a trading platform which I only started doing earlier this year. I'm on the lower tax band, but literally just below the cut-off I think. Does this mean I'm better to go for growth trusts rather than dividend yielding ones? Will the dividend yield income push me into the higher tax bracket rendering the dividend trusts pretty useless to me?

    I'm planning on holding my investments long term, both my individual stocks and these trusts if I purchase them, 10 - 15yrs. Although, I wouldn't mind holding the trusts for shorter term like 5 yrs if that makes more sense for them.

    What sort of a yield should you expect, or what way does the yield work? Is the dividend yield paid out based on the price you bought in at via the trusts share price at the time of purchase? If I buy a trust share @€1000, and the trust yield is 10%, do I receive €100? Could someone give a practical example please? The yield I get from some of my dividend paying stocks is paltry, nearly pointless sums, I'm assuming UK Trusts are paying a much more worthwhile amount?

    I've read about the NAV trading at a discount / premium and how it's best to purchase into the trust at a discount, if possible of course. I notice the NAV isn't displayed on the platform exchange when I look at a trust's info on it, am I blind or do they not show it on the trading platforms? Is it only displayed on the trusts official fact sheet?

    I like the way the trusts continue to pay a dividend even during the downturns and the way they keep cash reserves to be able to pay a similar dividend even in the downturns. All my stocks are pretty much growth based, the dividend paying ones are tiny, so I think I'd like to look for trusts on a good dividend paying basis for difference. Is it good to have a mix of growth / dividend instead of all growth based?

    I'm looking into the common / popular Trusts that I've read about online, likes of SMT, FCIT, CGT, JGGI, TMPL, JAM, JMG, BNKR, MNKS, etc.. I'm still doing my research on these trusts so apologies if some of these don't pay a dividend. If anyone has an opinion on this little plan of mine I'd appreciate it, positive or negative.