Abrdn Di&g Regulatory News (ADIG)

London, UK, 17 March 2020

Edison issues review on Aberdeen Diversified Income and Growth Trust (ADIG)

Aberdeen Diversified Income and Growth Trust (ADIG) aims to generate attractive long-term income and capital returns from its diversified multi-asset portfolio. In line with the March 2017 strategy change, the process of recycling capital from listed to longer-term, unlisted holdings is continuing. These should represent c 43% of NAV (vs 26% at end-September 2019) on full deployment of existing commitments. ADIG's underperformance since the strategy change reflects, among other things, ongoing portfolio repositioning, issues with its insurance-linked and litigation finance holdings and the value bias of its listed equity exposure. Since end-May 2019, the discount to NAV has been above the targeted 5%. That said, ADIG outperformed its benchmark over the last 12 months and it continues to offer an attractive prospective dividend yield of c 5.6%.

Since the strategy change in March 2017, ADIG's NAV TR performance has lagged its benchmark (Libor + 5.5%), which has resulted in a NAV discount in excess of 5% in recent months. Over the 12 months to January 2020, the NAV TR of 7.5% was ahead of the benchmark, aided by the solid performance of emerging market bonds and asset-backed securities. The last 12 months (LTM) dividend yield of 5.5% is ahead of most of its peers.

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