Understanding Listed Investment Trusts

At Pergam, we recently hosted a roundtable with two leading listed Private Equity players—Partners Group and Apax—to explore listed Investment Trusts (ITs). These investment vehicles provide liquid access to private company portfolios, offering a unique bridge between private and public markets.

Primarily listed in London, these trusts allow investors to gain exposure to non-listed companies while trading on the stock exchange like traditional equities. This hybrid investment format is still relatively unknown in France but is increasingly attracting attention from investors seeking diversification and flexibility.

How These Vehicles Provide Liquidity and Diversification

Listed Investment Trusts combine the benefits of private equity with the convenience of public markets. Investors can:

• Gain exposure to private company portfolios without committing capital for long illiquid periods

• Trade shares on the stock market, providing daily liquidity similar to traditional equities.

• Access a diversified range of sectors and geographies, enhancing portfolio resilience.

This structure addresses a growing demand among investors for flexible, liquid alternatives to traditional private equity.

Key Takeaways for Investors

The roundtable discussions highlighted several important considerations:

• Investment Approaches: Strategies employed by listed ITs to select high-potential private assets.

• Structural Discounts: The common market discount relative to net asset value, which may offer investment opportunities.

• Distribution Policies: How income and returns are shared with investors.

• Valuation Potential: Opportunities for capital appreciation in the medium to long term.

These characteristics can enhance overall portfolio returns, though investors are reminded that past performance is not indicative of future results.