Disclosure – Non-Independent Marketing Communication. This is a non-independent marketing communication commissioned by Brunner. The report has not been prepared in accordance with legal requirements designed to promote the independence of investment research and is not subject to any prohibition on the dealing ahead of the dissemination of investment research.


investingBUT trades at an attractive discount despite ranking as one of the top-performing global equity trusts over the past 12 months…





Brunner (BUT) has retained its balanced, ‘core’ style of investing even through today’s difficult markets. BUT is managed by Matthew Tillett, who follows a process which places the greatest weight on the ‘quality’ factor. He is supported by Christian Schneider and Marcus Morris-Eyton two leading Portfolio Managers in the AllianzGI Global Equity team.

Thanks to BUT’s global remit the team can invest across the entire market spectrum, with BUT’s portfolio capturing both the value and growth ends of the market. As a result, BUT’s portfolio is well diversified across multiple factors, including geography, sector, and style.

Matthew has a contrarian approach to investing, typically purchasing out-of-favour companies to capitalise on long-term mispricing. We highlight one example of this in the Portfolio section, that being the recent rotation out of ‘commodity capital’ banks and into shunned but higher-quality specialist banks.

Matthew’s balanced approach has paid off in recent months, as BUT has avoided many of the painful drawdowns its peers have suffered. In fact, recent Performance has been so strong that it ranks as the second best-performing global equity trust over the last 12 months, and the third over the last three years. It has also outperformed its benchmark over the last five years.

BUT has a dual mandate for both capital and income growth, and has been highly successful in providing both. within particular this year marks the 50th consecutive increase in Dividends paid. Yet despite BUT’s recent performance and dividend history, it trades on a 10.7% discount at the time of writing, wider than its peers and in line with its own long-term average.

However, BUT’s current Discount does reflect a near-term widening, likely brought about by the recent fall in the market’s appetite for risk. There have also been publicised sell downs in investment trusts across the sector by institutional investors who are reducing risk and have created temporary overhangs on the stock.



Analyst’s View



We believe BUT’s balanced approach and global equity exposure, coupled with its impressive dividend track record and strong ESG credentials, mean it could function as an investor’s primary equity holding. This is especially the case for investors looking for genuine active management, but who ultimately want a ‘fire and forget’ type of investment that they can be confident won’t majorly deviate in style. However, we add the caveat that BUT does have a structurally large allocation to the UK, which may reduce its diversification potential for investors with a strong UK bias.

In the near term, we believe there is a potential opportunity in BUT’s widening discount. Even if the near-term volatility stemming from the Ukrainian crisis subsides, investors will still need to grapple with rising inflation and restricted global supply chains. These factors have driven BUT’s recent outperformance against its peers and may continue to act as a tailwind for BUT’s future outperformance as well, thus being a potential catalyst for BUT’s discount to narrow.

BUT offers something which we believe investors may be increasingly appreciative of in a market dominated by growth stocks: a consistent, concentrated but stylistically balanced global equity portfolio. In today’s increasingly tumultuous markets, investors who are looking to reduce their style exposures (which may certainly be the case for growth-heavy portfolios) might in our view be well served by choosing BUT, as it would allow them to reduce any existing biases while still retaining stock-level diversification. This could not easily be accomplished with a passive product, given the inherently large exposure to the US mega caps that have previously dominated global equity market returns.




  • Balanced approach to investing has cushioned it from some of the recent market downturns
  • Discount offers attractive entry point
  • Celebrates its 50th consecutive year of dividend increases this year



  • Large UK bias can reduce diversification benefits
  • Gearing can amplify losses on the downside
  • Can underperform in periods of stylistically driven markets


To read the latest research on Brunner click here >


investment trusts income



This report has been issued by Kepler Partners LLP.  The analyst who has prepared this report is aware that Kepler Partners LLP has a relationship with the company covered in this report and/or a conflict of interest which may impair the objectivity of the research.

Past performance is not a reliable indicator of future results. The value of investments can fall as well as rise and you may get back less than you invested when you decide to sell your investments. It is strongly recommended that if you are a private investor independent financial advice should be taken before making any investment or financial decision.

Kepler Partners is not authorised to make recommendations to retail clients. This report has been issued by Kepler Partners LLP, is based on factual information only, is solely for information purposes only and any views contained in it must not be construed as investment or tax advice or a recommendation to buy, sell or take any action in relation to any investment.

The information provided on this website is not intended for distribution to, or use by, any person or entity in any jurisdiction or country where such distribution or use would be contrary to law or regulation or which would subject Kepler Partners LLP to any registration requirement within such jurisdiction or country. In particular, this website is exclusively for non-US Persons. Persons who access this information are required to inform themselves and to comply with any such restrictions.

The information contained in this website is not intended to constitute, and should not be construed as, investment advice. No representation or warranty, express or implied, is given by any person as to the accuracy or completeness of the information and no responsibility or liability is accepted for the accuracy or sufficiency of any of the information, for any errors, omissions or misstatements, negligent or otherwise. Any views and opinions, whilst given in good faith, are subject to change without notice.

This is not an official confirmation of terms and is not a recommendation, offer or solicitation to buy or sell or take any action in relation to any investment mentioned herein. Any prices or quotations contained herein are indicative only.  

Kepler Partners LLP (including its partners, employees and representatives) or a connected person may have positions in or options on the securities detailed in this report, and may buy, sell or offer to purchase or sell such securities from time to time, but will at all times be subject to restrictions imposed by the firm’s internal rules. A copy of the firm’s Conflict of Interest policy is available on request.


Kepler Partners LLP is authorised and regulated by the Financial Conduct Authority (FRN 480590), registered in England and Wales at 9/10 Savile Row, London W1S 3PF with registered number OC334771.

Leave a Reply