In this episode, our director of content, investment trusts Milosz Papst provides an overview of this specialist emerging markets trust which aims to generate an attractive long-term total return from a diversified portfolio of emerging market equities, primarily in the infrastructure, utility and related sectors. He outlines the four megatrends identified by ICM, the trust’s manager: social infrastructure, energy growth & transition, digital infrastructure, and global trade. He explains UEM’s focus on countries which exhibit positive attributes such as political stability, economic development, an acceptable legal framework, and an encouraging attitude to foreign investment. He highlights that the trust has recently become an AIC next-generation dividend hero. Finally, he elaborates on the trust’s discount to NAV.

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About Uncovering Trusts: Uncovering Trusts is a podcast run by Edison analysts, which is released every two weeks. Subscribe to hear analyst interviews on how investment trusts maximise returns while managing risks for investors.

Edison’s investment companies team recently published a review on Utilico Emerging Markets Trust (ticker: UEM). The trust’s managers, Charles Jillings and Jacqueline Broers, report that UEM’s utility and infrastructure investments are performing well, and believe that they are relatively well positioned in the current uncertain macroeconomic environment given their high-quality, cash generative assets. Many portfolio companies have a domestic or regional focus and so should be relatively insulated from US tariffs. The outlook for emerging markets remains encouraging, with above-average growth prospects and attractive valuations. UEM has a long-term record of outperformance versus the MSCI Emerging Markets Index and a growing dividend that is fully covered by income, which offer the scope for a much lower discount when market conditions stabilise.