There are other opportunities for bargain-hunters in natural resources and smaller companies trusts, while income and environmental funds are unusually dear.
Iain Scouller, analyst at Oriel, says that Baillie Gifford Shin Nippon IT suffered more than its peers in the country’s recent sell-off.
"Many of the Japanese trusts have seen a sharp de-rating following the falls in the market over the last couple of weeks," he said.
Baillie Gifford Shin Nippon slipped onto an 11 per cent discount on Monday, its widest level for the past six months, before recovering to a 3.5 per cent discount at the time of writing.
This is still very low in comparison to its one-year average premium of 0.41 per cent, while during the period the premium has been as high as 10.45 per cent and the discount as wide as 10.87 per cent, according to AIC data.
Price and NAV of trust over 1yr
Source: FE Analytics
The share price peaked at 338p just three weeks ago on 13 May, and fell 28.92 per cent to 240.25p on Monday, recovering to 262.5p at the time of writing.
The £90m trust invests in smaller companies, which should make it more volatile, but manager John MacDougall told FE Trustnet recently that this part of the market has a better quality of company than the large cap index.
JP Morgan Japan Smaller Companies also saw its discount widen to 16 per cent compared with a six-month range of 17 to 4 per cent; it has since narrowed slightly to 14.56 per cent.
At £70.4m, the trust is comparable in size to MacDougall’s, although the Baillie Gifford one has the superior track record over three, five and 10 years.
Over five years, Baillie Gifford Shin Nippon has made 89.53 per cent in share price terms, according to our data, while the JP Morgan Japanese Smaller Companies Trust has made 2.64 per cent.
Performance of trusts over 5yrs
Source: FE Analytics
Scouller highlights City Natural Resources High Yield as a trust to have suffered a particularly vicious re-rating.
It sits on a discount of 21.1 per cent, which is its widest for the last six months, in which it has been as tight as five per cent.
The £103m trust invests in the mining sector, and has suffered as the companies in that industry have done so too.
The HSBC Global Mining Index has lost 10.67 per cent over the past year, according to data from FE Analytics, while the trust has lost 30.9 per cent in share price terms and 24.4 per cent in NAV terms.
Performance of trust vs index over 1yr
Source: FE Analytics
Herald Investment Trust, a £430m trust that invests in media and telecoms companies, has seen its discount widen to 21 per cent, which puts it close to its six-month high of 22 per cent; its lowest is 13 per cent.
Scouller points out that European trusts have seen a sharp re-rating recently, with many now close to their narrowest discount for at least two years.
Henderson Euro Trust is on a 5.9 per cent discount which compares with a six-month range of 5 to 11 per cent.
This follows a year in which it has made 51.38 per cent in share price terms while the FTSE World Europe ex UK index has made 39.32 per cent.
Performance of trust vs index over 1yr
Source: FE Analytics
Scouller says that investors might like to look at alternatives to Bankers IT as well.
The analyst says that it looks expensive at the moment, particularly given what he says is its "fairly average recent performance compared to other international trusts".
According to the AIC, the trust is trading on a 1.32 per cent discount, close to the one-year low of 0.73 per cent.
Income funds remain in demand, Scouller says, with Murray Income on a 1.8 per cent premium, although it has been as high as 5 per cent over the past six months.
Henderson International Income is also looking expensive on a 4.5 per cent premium, which compares with a six-month range of 2 to 6 per cent.
Impax Environmental Markets has seen a sharp positive re-rating to a 10.7 per cent discount following last week’s announcement of a new 10 per cent discount control policy using share buybacks.
The trust has ranged between a 20 per cent and 10 per cent discount over the past half-year.
Jupiter Green saw its discount narrow to 4 per cent before widening slightly to 6.4 per cent. The board has decided to use buybacks with an aim of seeing the discount move close to zero ahead of the AGM, which is expected in September.
Over the past six months the discount has ranged from 11 to 4 per cent.
