Personal Assets Trust
The firm states that it is 'run expressly for private investors'. In view of this, and to aid regular investors investing through investment plans, the firm has a buy back and issue policy in order to maintain the share price close to net asset value.
It states that 'The Directors believe that the profile of a typical investor in the Company is a professionally advised private individual with either a substantial amount of capital or an expectation to build it out of income, who is seeking to protect and increase (in that order) his funds over the long term and to earn as high a total return as is compatible with a risk equivalent to that of the FTSE All-Share Index., and that 'while the Company invests predominantly in the UK, overseas exposure for the Company may range between 50 per cent of total assets and zero.' 'The Company’s equity portfolio is usually concentrated in a short list of stocks and turnover tends to be low. There are no predefined maximum or minimum exposure levels for asset classes but these exposures are reported to, and monitored by, the Board in order to ensure that adequate diversification is achieved. No holding in an individual company will represent more than 15 per cent. by value of the Company’s investments at the time of acquisition.'
The day-to-day management of the company is by Sebastian Lyon of Troy Asset Management but the investment policy direction is the responsibility of the board. It is significantly similar to Lyon's Trojan Fund, which is an open-ended investment company; prior to Lyon's appointment in 2008/9, the investment policy, while having similar goals, was executed somewhat differently by Ian Rushbrook, now deceased.
As of 13 April 2012, the shares traded at £339.50, a 1.3% premium to net asset value, and with a yield of 1.6%. The market capitalization was £450m. The fund held 50% of assets in equities (in 22 different companies, of which 20% of total assets are in UK equities, 22% in the US, Nestle, of Switzerland, and three miners/oil producers in Canada and Australia), 37.5% in government debt (mostly US Treasury Inflation Protected Securities but also UK and Singapore T-Bills, and the remaining 12.5% in Gold Bullion (held through an ETF).
The firm launched in September 1983. By 31 October 1990 amid indifferent performance, NAV had barely increased, from £5.4 million to £6.9 million, and the share sold at substantial a discount to net asset value. The firm's Board assumed responsibility for its management at that time, appointing Ian Rushbrook as Investment Director of the firm. He began a share buyback programme, in order to keep the share price close to net asset value (NAV), eliminating the discount to NAV then present, and maintaining steady growth. Following a 1 for 100 consolidation in January 1993, the share price stood at year end 30 April 1993 at £81.59, at 1994 at £89.50, at 1995 at £87, at 1996 at £118.50, at 1997 at £141.25, at 1998 at £199.50 at 1999 at £202.50, and at 2000 at £202. The growth in asset value in good years, while maintaining shareholder value in bad ones, saw many investors subscribing as the fund issued new shares to meet demand and reduce the premium to net asset value. Between y/e 1995 and y/e 1998, the shareprice rose by 130%, while shareholders funds increased 250%, and between y/e 1998 and y/e 2003, shareholder funds doubled even as the shareprice fell slightly.
For the year ending 30 April 2001, the fund's NAV rose by 3.6%, which was 8.4% higher than the FTSE All Share. It held roughly 50% of assets in the money-market and TIPS, with the rest in UK equities with a smaller holding in US equities. Its largest shareholdings were Scottish & Newcastle, BP, and Royal Bank of Scotland.
For the year ending 30 April 2002, NAV fell by 1.8%, while the FTSE All Share fell by 12.4%. The firm retained its 50% liquidity position.
For the year ending 30 April 2003, amid the stock market downturn of 2002 the NAV fell by around 8.4%, against a fall in the FTSE All Share of 24.7%. During f/y 2003 the firm made extensive use of FTSE 100 futures, buying futures each time the market fell, as a cheaper alternative to buying more shares. Thus at year end, with a 40% FTSE futures position, liquidity was only 20%, and effective UK Equity exposure was 80%. There were otherwise no changes to the firms positions, and long-term bearishness was expressed.
For the year ending 30 April 2004, the bearishness of the firm in what was a bull market resulted in underperformance relative to the market - NAV increased by 12.8% while the FTSE All Share rose by 18.3%. Rushbrook stated that UK equities were overvalued and US equities even more so. At year end liquidity increased slightly to 31%, with some of the equity position unwinding into increased holdings in Royal Bank of Scotland, BP, HBOS, Shell and Barclays.
For the year ending 30 April 2005, net asset value increased by 5.3%, lower than the FTSE All Share, which rose by 7.1%. The firm held a 20% position in banks, and 14% in oil, 31% in other sectors, and 35% liquidity, amid continued bearishness by the firm's management.
For the year ending 30 April 2006, net asset value increased by 15.8%, while the FTSE All Share rose by 28.3%. The firm responded bearishly, by increasing its liquidity position to 41% at year end.
For the year ending 30 April 2007, NAV rose by 3.3%, while the FTSE All-Share rose by 9.2%, a fourth consecutive year of the firm underperforming a rising FTSE. There was no change in the firm's major positions in banks and oil. The firm reported that at year end, in its view, the FTSE was 45% overvalued. Year-end liquidity was 50%.
Over the period July–September 2007 the firm increased its liquidity position to 100% as a result of the beginnings of the credit crunch, achieved by selling FTSE 100 futures equal to the value of its equity holdings. The market having fallen by 10% by January 2008, the firm reduced its liquidity to 70%, but after it recovered its losses the firm reverted to 100% liquidity. By year end, 30 April 2008, NAV fell by 2.8%, while the FTSE All-Share fell by 7.6%, and liquidity was 100%.
On 12 October 2008, the firm's Investment Director, Ian Rushbrook died, aged 68. As a result he was replaced by Troy Asset Management, whose director Sebastian Lyon, held a personal shareholding in PAT since 1999. While Rushbrook refused to invest in gold, Lyon invested 6% in bullion securities. He also bought the company's only European investment, Nestl,.. At 30 April 2009, NAV fell 10.8% YoY, while the FTSE All-Share fell 29.9%. Net equity exposure at year end was 70%, with a 6% bullion and 24% liquidity position. Lyon also increased the firm's US equity stake to 16%.
At 30 April 2010, NAV increased YoY by 24.9%, against 31.8% for the FTSE All Share. Bullion exposure was 9.7%, with further liquidity of 25.8%.
At 30 April 2011, NAV increased YoY by 9.8%, against 10.2% for the FTSE All Share.
At 30 April 2012, NAV increased YoY by 6.6%, against (5.4)% for the FTSE All Share.
At 30 April 2013, NAV increased YoY by 4.8%, against 13.6% for the FTSE All Share.
- Personal Assets Trust: Prospectus
- Personal Assets Trust: Annual Report 2003
- Personal Assets Trust: Quarterly Report 59
- Personal Assets Trust: Annual Report 2001
- Personal Assets Trust: Annual Report 2005
- Personal Assets Trust: Annual Report 2006
- Personal Assets Trust: Personal Assets Trust: Annual Report 2007
- Personal Assets Trust: Quarterly Report 46
- Personal Assets Trust: Quarterly Report 47
- Personal Assets Trust: Annual Report: 2008
- Obituary: Ian Rushbrook The Scotsman, 13 October 2008, retrieved 21 April 2012
- Personal Assets Trust: Quarterly Report 52
- Personal Assets Trust: Quarterly Report 53
- Personal Assets Trust: Annual Report 2009
- Personal Assets Trust: Annual Report 2010
- Personal Assets Trust: Annual Report 2011
- Personal Assets Trust: Annual Report 2012
- Personal Assets Trust: Annual Report 2013