Securities Trust of Scotland (STS) seeks a combination of rising income and long-term capital growth from a concentrated (currently 46 stocks) global portfolio of mainly larger companies. Stocks are chosen for attributes including yield and dividend growth, financial strength and valuation. Recently the shares have moved to a discount to NAV, but a new policy to enhance the yield, together with the potential for better underlying performance, could see the shares re-rate to a level closer to peers.
In this interview, the portfolio manager, Alan Porter, explains the rationale for recent additions to the portfolio and the change in the dividend policy.