This blog gives you the latest topical news plus some informal comments on them from ShareSoc’s directors and other contributors. These are the personal comments of the authors and not necessarily the considered views of ShareSoc. The writers may hold shares in the companies mentioned. You can add your own comments on the blog posts, but note that ShareSoc reserves the right to remove or edit comments where they are inappropriate or defamatory.

Scottish Investment Trust Reviewing Management Arrangements

I wrote about the Scottish Investment Trust (SCIN) back in February and commented negatively on its underperformance in recent years. Their investment style has been based on a contrarian approach, i.e. picking cheap stocks that look undervalued but which might recover. The article included this comment: “It would appear that they adopted the new investment style five years ago which might be identified as when under-performance took off. If an investment strategy does not work, how long should you persist with it? Not many years in my experience. It’s too easy to hold the dogs longer than you should”.

Since I wrote the article the company has been running advertisements on an “ugly duckling” theme suggesting that the undervalued investments it holds will turn into beautiful swans given some patience. I found these advertisements quite amusing.

But it seems the directors have finally lost patience because they have announced a “Review of Investment Management Arrangements”. They are inviting proposals from fund management groups who might take over managing the fund.

The board is to be congratulated on finally taking action. Better late than never.

Note: The company should not be confused with the Scottish Mortgage Investment Trust which is an unrelated company. Note also that I do not hold SCIN shares.

Roger Lawson (Twitter: https://twitter.com/RogerWLawson  )

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