Last checked at 7 Jul 2021 07:00
London, UK, 7 July 2021
Edison issues review on BlackRock Greater Europe Investment Trust (BRGE)
BlackRock Greater Europe Investment Trust (BRGE) has a long-term record of outperformance versus its peers and the broad European market. It has two co-managers: Stefan Gries, since June 2017, covering developed European markets (c 90% of the fund); and Sam Vecht, since the trust's launch in September 2004, covering emerging European markets (c 10% of the fund). While all the trust's positions are selected following thorough fundamental analysis rather than taking a view on the macro environment, Gries is optimistic about the prospects for an upcoming economic recovery in Europe. So far, its vaccine program has lagged the pace of other regions such as the US and the UK, so there is potential to catch up, and there is a coordinated €750bn EU Recovery Fund in place to be spent on green initiatives, which has not yet been employed.
BRGE has been re-rated in recent quarters and now regularly trades at a premium, indicating strong demand for the company's shares. It is currently trading at a 2.0% premium to cum-income NAV, compared with a 0.8% to 3.8% range of average discounts over the last one, three, five and 10 years. So far in FY21, the board has been able to reissue a meaningful number of shares from treasury (see page 9). While BRGE offers a modest 1.0% dividend yield, the annual distribution has increased each year since the trust was launched, and this was possible in FY20 (a period of lower income) due to its revenue reserves.
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