Investment Objective and Policy
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Investment Objective and Policy

Investment Objective

The Company’s investment objective is to protect the purchasing power of its capital in real terms, and to participate in enduring economic activities which lend themselves to genuine capital accumulation and wealth creation.

Investment Policy

The Company will seek to acquire and hold, with no predetermined investment time horizon, a collection of assets which, in the Directors’ judgment, are well-suited to the avoidance of a permanent loss of capital. These assets will be comprised of minority participations in the equity, debt or convertible securities of quoted businesses which the Directors believe are led by responsible and like-minded managers and suitable for the long-term compounding of earnings. In addition, to protect its capital as well as to maintain liquidity for future investments, the Company will keep reserves in (a) liquid debt instruments such as cash in banks or securities issued by governments and/or (b) liquid, non-debt, tangible assets such as gold bullion, whether held indirectly or in physical form.

The Company has no predetermined maximum or minimum levels of exposure to asset classes, currencies or geographies, and has the ability to invest globally. These exposures will be monitored by the Board in order to ensure an adequate spreading of risks. No holding in an individual company or debt instrument will represent more than 15 per cent. by value of the Company’s total assets at the time of acquisition (such restriction does not, however, apply to gold bullion or cash balances). The Company’s holdings of gold bullion may be as high as 35 per cent. of total assets at the time of investment.

Given the Company’s investment objective, asset mix and time horizon, the portfolio will not seek to track any benchmark or index. The Company will not invest more than 10 per cent. of its total assets in other listed closed-ended investment funds. The Company will not use derivative instruments for speculative purposes, nor will it use currency hedges to manage returns in any currency. The Company’s gearing will not exceed 20 per cent. of net assets at the time of drawdown.

There is no fixed maturity date. There is no ability for the Company to terminate shareholdings of investors in the Company unilaterally or automatically. The next shareholder vote on the continuation of the Company as an investment trust will take place in 2025. If shareholders vote in a simple majority against continuation, the Board would have to put forward a proposal for the future of the Company, which could include liquidation.

The company is managed by its Board and does not have an external investment manager.