Dexion Investment Trust: An Overview

Dexion Investment Trust plc (DXN) is a closed-ended investment company listed on the London Stock Exchange. Its primary objective is to generate a consistent and growing income stream for its shareholders, while also aiming for capital appreciation over the long term. DXN achieves this by investing in a diversified portfolio of primarily closed-ended funds, with a focus on alternative assets and specialist investment strategies.

Investment Strategy

The core of Dexion Investment Trust’s strategy lies in identifying and investing in undervalued or overlooked closed-ended funds. This includes investment trusts, REITs (Real Estate Investment Trusts), and other similar vehicles that trade at a discount to their net asset value (NAV). By purchasing these funds at a discount, DXN aims to benefit from both the underlying asset appreciation and the potential narrowing or elimination of the discount itself.

The Trust’s investment team, managed by Hawksmoor Investment Management, actively researches and selects funds across a wide range of asset classes and geographical regions. While aiming for income, DXN is not restricted by sector or geographical mandate, allowing for flexibility in capital allocation to the best available opportunities. This allows for access to investments that might be difficult or impossible to obtain directly for individual investors, such as private equity, infrastructure, specialist debt, and niche real estate sectors.

Portfolio Composition

Dexion Investment Trust’s portfolio is typically diversified across a multitude of underlying investments. The specific composition will vary based on market conditions and the investment team’s outlook, but generally includes exposure to areas such as:

• Alternative Assets: Private equity funds, infrastructure funds, hedge funds, and other less traditional investments.
• Real Estate: REITs and property funds focusing on various sectors like commercial, residential, and specialist properties.
• Specialist Credit: Funds investing in direct lending, asset-backed securities, and other credit-related instruments.
• Geographical Diversification: Investments across various regions, including the UK, Europe, North America, and emerging markets.

Key Considerations for Investors

Potential investors in Dexion Investment Trust should be aware of several key considerations:

• Closed-Ended Structure: As a closed-ended fund, DXN’s share price can trade at a premium or discount to its NAV. This discount/premium can fluctuate based on investor sentiment and market conditions.
• Alternative Asset Exposure: The focus on alternative assets can lead to greater volatility compared to traditional equity or bond investments. However, it can also offer diversification benefits and potentially higher returns.
• Income Focus: While aiming for capital appreciation, DXN’s primary objective is to generate income for shareholders. This makes it attractive to income-seeking investors.
• Management Fees: Investors should consider the ongoing charges and management fees associated with the Trust, as these can impact overall returns.
• Illiquidity of Underlying Investments: Some underlying investments may be less liquid than publicly traded stocks or bonds, which can potentially affect the speed and ease of selling positions.

In conclusion, Dexion Investment Trust offers investors access to a diversified portfolio of closed-ended funds, with a particular focus on alternative assets and income generation. It is crucial for potential investors to carefully consider their investment objectives, risk tolerance, and understand the specific risks and characteristics of closed-ended funds before investing.