26th Jul 2016 10:17
LONDON (Alliance News) - Small companies-focused investor Athelney Trust PLC on Tuesday said the "huge fall in property shares" following the UK's vote to leave the European Union hit its performance in the first half of 2016, but said markets should "settle down".
The trust said its net asset value per share at the end of June was 216.50 pence per share, down from 245p per share at the end of December and from 236p a year earlier. Athelney's overall return for the first half was minus 8.4%, the company said.
Speaking about Athelney's property-focused holdings, Chairman Manny Phol said the liquidity of open-ended funds "was often held in the form of Real Estate Investment Trusts shares since bank deposit rates are very low - naturally, all these shares have been sold thus depressing prices and sentiment even more".
"Selling has continued into July so expect more of the same. Having said all that, I would not be in favour of joining the Gaderene swine by selling Athelney's property shares. They will be reviewed one by one and, if found wanting, will be replaced by better choices but please do not expect the substantial commitment to the sector to fall by much, if at all. First and foremost, they are great dividend payers and, second, there is virtually nothing in Athelney's portfolio in the over-heated London commercial and residential market," Phol added.
"In the near-term, though, the huge fall in property shares adversely affected Athelney's performance between the date of the referendum and the end of the trust's first half - only seven days but what a difference a week makes," the chairman said.
"The three small cap indices that I track did pretty well on the whole with falls of only 3.5%, 3.4% and 3.9% respectively over the six months under review whereas the total return on Athelney's shares was minus 8.4% because of its 27% stake in property shares," Phol added.
However, the chairman noted that he expects the UK economy to "readjust" and that markets will "settle down and, with interest rates likely to fall to zero and another dose of quantitative easing due quite soon, equities and commercial property (excluding the hot-spots) will look attractively priced".
Shares in Athelney were untraded on Tuesday, having last traded at 200.00p.
By Hannah Boland; [email protected]; @Hannaheboland
Copyright 2016 Alliance News Limited. All Rights Reserved.
Related Shares:
Athelney Tst.