Portfolio & Performance

ISIN GB0001490001
SEDOL 0149000

Share Price is the price of a single ordinary share, as determined by the stock market. The share price above is the mid-market price at market close.
Share Price

Net Asset Value (NAV) per Share is calculated as available shareholders’ funds divided by the number of shares in issue, with shareholders’ funds taken to be the net value of all the company’s assets after deducting liabilities. The NAV figure above is based on the fair/market value of the company’s long-term debt and preference shares (known as debt at market value). This allows for the valuation of long-term debt and preference shares at fair value or current market price, rather than at final repayment value (known as debt at par).
NAV per Share

Premium/Discount. Since investment company shares are traded on a stock market, the share price that you get may be higher or lower than the NAV. The difference is known as a premium or discount.

Dividend Yield is calculated using the latest full year dividend divided by the current share price.
Dividend Yield

Data source DataStream and Allianz Global Investors as at 19.11.2018 based on market close mid price.


The data shown is not constant over time and the allocation may change in the future. Totals may not sum to 100.0% due to rounding. All data source Allianz Global Investors unless otherwise stated.

Top 10 Holdings (%)

Royal Dutch Shell - B Shs
Cooper Cos
Agilent Technologies

Data as of 30.09.2018

Geographic Breakdown (%)

North America 43.1
UK 26.9
Europe ex UK 21.8
Pacific ex Japan 5.2
Japan 2.2
Cash 0.8

Data as of 30.09.2018. Excludes Cash

Sector Breakdown (%)

Health Care
Consumer Services
Consumer Goods
Oil & Gas
Basic Materials

Data as of 30.09.2018. Excludes Cash

Fund Manager Comments

Market Review

Global equities continued to diverge in September. While markets rose in aggregate, this was driven almost entirely by the US, with Japanese equities making some contribution due to a weaker currency. In contrast, European equities were flat for the month and emerging markets softened further.

Global concerns over trade continue. In September, the US imposed tariffs on a further $200 billion of Chinese imports – meaning that more than half of Chinese imports now carry tariffs. On a sector basis, Energy stocks outperformed as oil prices rose to their highest levels in four years. Higher yielding sectors like Utilities underperformed, weighed down by rising bond yields. The end of September marked thirteen weeks of continuous inflows into Healthcare funds, bringing them to $10 billion of inflows since July.

Oil prices rallied over September, with Brent crude rising above $82 a barrel, the highest level in four years. The advance was driven by concerns that US sanctions against Iran would curtail supply, as well as major oil producers’ refusal to increase production.

Portfolio Review

The Trust’s NAV rose by 0.68% in September against a benchmark return of 0.41%. As per our investment philosophy, stock selection drove the largest positive contribution to returns. This was particularly strong in Consumer Services and Financials.

Last month’s purchase of The Cooper Companies was September’s biggest positive contributor to returns. Shares in the maker of eye care and surgical products rallied following Q3 results, with revenues up 19% year on year. While earnings per share were moderately affected by currency headwinds, investors have focused positively on management’s desire to increase spending with a view to growing sales. This move to corner markets more aggressively marks a notable escalation in strategy under Albert White, who took over as CEO in May this year.

EOG Resources also boosted performance, entirely reversing its weakness in August. As per its Q2 results, the US energy company has worked hard to improve its efficiency and is one of the clearest beneficiaries from higher oil prices. This month, EOG also agreed the sale of its UK assets to a private company called Tailwind Energy. Although a transaction price was not disclosed, the move reflects EOG’s plan to divest non-core properties.

United Internet has been the largest detractor from performance due to two concerns: increased mobile competition and potential for uneconomic investment in 5G. At the start of the quarter, Telefonica Deutschland’s low-frills ‘Blau’ offering suggested a more aggressive competitive stance. United’s Q2 results appeared to confirm this, as it reduced its full year net additions targets from 1.2 to 1 million. Our view is that, though skirmishes will always remain a feature, the competitive environment is relatively stable.

Microchip also detracted from returns this month. The US semiconductor manufacturer has continued to suffer after revealing that the recently acquired Microsemi had inflated its sales figures ahead of purchase. While Microchip is confident that this issue is now resolved, President Trump’s additional tariffs on China and the prospect of slower growth for the auto industry are placing further pressure on the stock.

Significant Transactions

We have sold our holdings in BASF and Tencent.

Market Outlook

Markets appear firmly set on the divergent paths established earlier this year. Yet there are signs of movement within this divergence.

In the US, market sentiment is unerringly positive. September saw yet another record high for the S&P 500 index. But thanks to President Trump’s fiscal stimulus, this economic supremacy has coincided with progressive trade confrontation.

The news that Canada has joined Mexico and the US to sign a renegotiated North American Free Trade Agreement (NAFTA) should appease markets. However, to his supporters, it will also validate the President’s protectionist stance. Consequently, we expect the rhetoric to ratchet up further until after November’s mid-term elections.

Equities in sectors heavily reliant on US imports or with a large exposure to Chinese manufacturing like Autos and IT Hardware, are already suffering. In addition, European stocks are reflecting softer business conditions. And, as Argentina and Turkey have shown, a strengthening US dollar is putting still more pressure on vulnerable emerging markets.

These dynamics are complicated further by rising inflation and expectations of tighter monetary policy. In the US, this is being driven by strong economic growth, with a fourth rate rise expected before the end of the year. Elsewhere, tariffs and rising oil prices are having the same effect.

As long-term investors, we buy companies on the basis of their ability to outgrow markets over the long-term, regardless of short-term economic cycles. However, there are companies in the portfolio which are more likely to outperform in a more reflationary, value-driven environment. As such, we are starting to reduce some of our best performing positions in favour of the latter.

Lucy Macdonald 10 October 2018

As long-term investors, we buy companies on the basis of their ability to outgrow markets over the long-term, regardless of short-term economic cycles.

This is no recommendation or solicitation to buy or sell any particular security.


Performance (%)

Select period:

    Cumulative Returns (%)

    3M 6M 1Y 3Y 5Y
    Share Price 0.5 7.3 11.7 63.4 82.9
    NAV 3.9 7.1 6.8 58.2 66.3
    Benchmark 4.4 12.4 12.1 58.5 72.5

    Source: Thomson Reuters DataStream, percentage growth, mid to mid, total return to 30.09.2018.1

    Discrete 12 Month Returns (%)

    2018 2017 2016 2015 2014
    Share Price 11.7 27.6 14.7 1.1 10.7
    NAV 6.8 17.5 26.0 -2.0 7.2
    Benchmark 12.1 13.7 24.4 -0.5 9.3

    Source: Thomson Reuters DataStream, percentage growth, mid to mid, total return to 30.09.2018.1

    1Past performance is not a reliable indicator of future returns. You should not make any assumptions on the future on the basis of performance information. The value of an investment and the income from it can fall as well as rise as a result of market fluctuations and you may not get back the amount originally invested.This investment trust charges 70% of its annual management fee to the capital account and 30% to revenue. This could lead to a higher level of income but capital growth will be constrained as a result.

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    © Allianz Global Investors GmbH 2018, Registered Office: Frankfurt am Main, Register: HRB 9340, Local court: Frankfurt am Main. All Rights Reserved. The Brunner Investment Trust PLC is incorporated in England and Wales. (Company registration no. 226323). Registered Office: 199 Bishopsgate, London, EC2M 3TY. VAT registration no. 244 7355 54. The Company is a member of the Association of Investment Companies - Category: Global Growth.