Stock picking for the pandemic era
Excellent financial performance during the lockdown and strong resilience in terms of operating profits and liquidity, performed the stock picking of ALPHA TRUST-ANDROMEDA INVESTMENT TRUST S.A., based on the published results of the first half of 2020.
As the investment interest was mainly focused on companies listed on the Athens Stock Exchange, with good fundamentals in attractive valuations, the portfolio recorded profits of 8.90% during the third quarter of 2020, while the ATHEX Composite Total Return Index declined by -1.03% the same period. Since the beginning of the year, the losses of the portfolio have moderated (-14.18%) outperforming by c.15% the performance of the ATHEX Composite Total Return Index (-29.87%).
As the portfolio manager ALPHA TRUST stated: "Companies that make up 53% of the ALPHA TRUST-ANDROMEDA’s portfolio, recorded growth in both sales and profits in the first half of 2020, while the rest showed strong resilience during the lockdown. In the short term, the selection of companies based on fundamentals that support their valuations is expected to continue. In the long term, the supportive fiscal policy, the European Recovery Fund and the discovery of the vaccine could be catalysts.”
ALPHA TRUST-ANDROMEDA INVESTMENT TRUST S.A., now the only closed-end fund listed on the Athens Stock Exchange and marking 20 years since its inception, has emerged as one of the top performing equity investments in Greece, with great resilience during challenging times.
Consistently focused on its investment strategy, has continued over the years to invest in noteworthy companies with attractive valuations, regardless of their capitalisation, offering satisfactory long-term returns.
Its net asset value has increased since its inception (25/7/2000) through 30/09/2020 by 50.65%, while the same period the ATHEX Composite Total Return Index declined by -70.82%. Similarly, since its investment strategy change (24/10/2011), the portfolio’s performance has reached 95.39%, compared to 1.31% for the aforementioned index.
In addition, the company has one of the highest dividend yields and capital returns, even during challenging times. For the 2019 financial year has completed the €0.75 capital return per share, which brings the dividend yield (at close on 30/09/2020) to 3.6%.
At the close of the third quarter of 2020, the company's portfolio was 93.86% invested in listed shares on the Athens Stock Exchange and in bonds.
The top equity holdings at 30/09/2020 were in the companies: QUEST HOLDINGS, THRACE PLASTICS, TITAN, ELVE and ENTERSOFT.
The ALPHA TRUST-ANDROMEDA INVESTMENT TRUST S.A. share with net asset value of €25.922 at 30/09/2020, was trading at -18.99% discount to NAV.
Note: The Athex Composite Total Return Index inception date is March 1st, 2001. Prior to that date, the weighted dividend yield of the market according to ASE data has been used.