Property and private equity trusts are exceedingly good value if their own long-term history is anything to go by, while global trusts and debt instruments are relatively poor value.
In this series, Trustnet is looking at the share price discounts to net asset value (NAV) of investment trusts today relative to their five-year average. Having previously looked at UK specialists, here we compare the average of IT sectors. Readers should note that all discount data is correct to the end of May.
Real estate investment trusts represent broadly good value, but those in the Property - UK Residential are truly cheap, data from the Association of Investment Companies shows.
Historically these trusts have traded around par but today investors can pick up shares at an average 37.4% discount.
The sector difference has largely been skewed by Home REIT, which dropped 78.8% in April as the former homeless accommodation provider returned from a 39-month share suspension incurred after research suggested the trust had overvalued its properties and income.
The real estate investment trust also remains the subject of a fraud investigation by police and a regulatory probe by the Financial Conduct Authority.
Despite the average widening, the largest trust in the peer group – Social Housing REIT – has actually narrowed.
The only other trust above £100m market capitalisation is Residential Secure Income REIT. This trust has become cheaper, with its share price discount of 38.1%, some 11 percentage points below its five-year average.
The peer group is joined on the heavily discounted list by Property - Debt and Property - Europe, where the average trust discount has widened from 10.7% and 25.1% respectively to 15.7% and 30.8%.
| The most expensive IT sectors relative to their own history | |||
| Trust | Discount at end of May | 5-year average discount | Difference |
| Growth Capital | 13.7% | -28.8% | 42.6% |
| Leasing | -21.7% | -30.1% | 8.4% |
| Global | -0.2% | -7.8% | 7.7% |
| Global Smaller Companies | -7.8% | -14.0% | 6.3% |
| Global Emerging Markets | -3.5% | -8.6% | 5.1% |
| Debt - Structured Finance | -2.3% | -7.4% | 5.1% |
Source: AIC, Morningstar. Data correct as of 31/05/2026.
In second place, the next-most attractive peer group is IT Private Equity, where trusts are trading on a share price discount of 25.9% having historically been on a 5.3% premium over the past five years.
This has been almost entirely impacted by 3i Group, however, the largest investment trust in the world. The £31bn trust is so large it can mov the entire sector's discounts on its own, as has been the case this time around. It has shifted from a five-year average premium of 19.6% to a discount of 25.3%.
Much relies on the trust's largest holding: Action, which makes up almost three-quarters of the trust. The trust plummeted when it warned Action's sales growth was weakening in France, its premier market.
Rounding out the group is the IT Renewable Energy Infrastructure sector, where the average discount has doubled from an average of 14% to today's 29.3%.
Among the sector's largest trusts, Aquila European Renewables has widened the most, with its 18.8% average discount growing to 61.4% by the end of last month.
However it is not the only one. All of the sector's 14 trusts with a market capitalisation of £100m or more are cheaper than their average, including the £4bn Greencoat UK Wind trust and £2.7bn Renewables Infrastructure Group.
While these peer groups are cheaper on average then their medium-term history, most investment trust sectors have narrowed in recent months. Now, only 11 peer groups are wider than their five-year average, compared with 25 that were narrower.
| The cheapest IT sectors relative to their own history | |||
| Trust | Discount at end of May | 5-year average discount | Difference |
| Property - UK Residential | -37.4% | -2.0% | -35.4% |
| Private Equity | -25.9% | 5.3% | -31.1% |
| Renewable Energy Infrastructure | -29.3% | -14.0% | -15.3% |
| Property - Europe | -30.8% | -25.1% | -5.7% |
| Property - Debt | -15.7% | -10.7% | -5.0% |
Source: AIC, Morningstar. Data correct as of 31/05/2026.
IT Growth Capital trusts have been the biggest winners, with the sector moving from an average five-year discount of 28.8% to a premium of 13.8%.
The big winner has been Seraphim Space Investment Trust, which has jumped from a 30.5% average discount to a 75.7% premium at the end of May.
It has benefited significantly from the launch of SpaceX (a, which enjoyed a strong start to life on the market last week). The Elon Musk-owned tech company has revitalised the space investing sphere and Seraphim has been recommended by some as a diversified way to play the asset class.
Performance has been so strong that it entered the FTSE 250 earlier this month.
IT Leasing is in second place, although the trusts remain heavily discounted. Over five years, investors could pick them up for 30.1% below their net asset value. Today that figure is 21.7%, around 8.5 percentage points difference.
IT Global and IT Global Smaller Companies come next with both coming in around 7 percentage points. The former has moved to around par while the latter has halved its discount. IT Global Emerging Markets trusts were next moving from an average discount of 8.6% to 3.5% at the end of May.