The Scottish Investment Trust - Golden opportunities for contrarian fund

The Scottish Investment Trust (SCIN) seeks to ignore the ‘madness of crowds’ and invest in deeply unloved areas of the global stock market, where recovery potential has been overlooked by the majority of investors. Absolute returns have been strong year to date (1 January to 31 August 2019), with share price and NAV total returns of more than 10%. However, performance has lagged the strong rebound in global indices, which have been driven by a relatively narrow range of highly valued stocks. Manager Alasdair McKinnon is backing areas including gold miners (the outlook for gold is positive given lax monetary and fiscal policy against a worsening economic backdrop, yet miners have remained out of favour) and telecoms, which offer limited economic sensitivity and attractive dividend yields.