BlackRock Latin American Investment Trust — Worthy allocation as part of a global portfolio

BlackRock Latin American Inv. Trust (LSE: BRLA)

Last close As at 22/05/2024

GBP3.88

−12.00 (−3.00%)

Market capitalisation

GBP115m

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BlackRock Latin American Investment Trust — Worthy allocation as part of a global portfolio

BlackRock Latin American Investment Trust’s (BRLA’s) lead manager Sam Vecht and deputy manager Christoph Brinkmann remain optimistic about the prospects for the region. Interest rates are coming down as Latin American central banks have been more proactive than those in developed markets in raising interest rates to combat higher inflation, which should be supportive for economic growth and asset prices. Latin America has remained relatively isolated from global geopolitical conflict, enabling trade with both eastern and western nations. The region has been overlooked by global investors, which has led to very attractive valuations on both absolute and relative terms.

Melanie Jenner

Written by

Mel Jenner

Director, Investment Trusts

Investment Companies

BlackRock Latin American IT

Worthy allocation as part of a global portfolio

Investment trusts
Latin American equities

14 March 2024

Price

405.0p

Market cap

£119m

Total assets

£141m

NAV*

456.0p

Discount to NAV

11.2%

*Including income. At 12 March 2024.

Yield

5.7%

Ordinary shares in issue

29.4m

Code/ISIN

BRLA/GB0005058408

Primary exchange

LSE

AIC sector

Latin America

Financial year end

31 December

52-week high/low

454.5p

334.0p

NAV* high/low

508.1p

372.7p

*Including income

Net gearing*

5.3%

*At 31 January 2023.

Fund objective

BlackRock Latin American Investment Trust seeks long-term capital growth and an attractive total return, primarily through investing in quoted Latin American securities. The trust was launched in 1990 and management was transferred to BlackRock on 31 March 2006 following a tender process. The trust has an indefinite life subject to a two-yearly continuation vote. The benchmark is the MSCI Emerging Markets Latin America Index.

Bull points

Diversified Latin American equity fund with a defined dividend policy and attractive yield.

Latin America is benefiting from geopolitical and economic isolation from global geopolitical conflicts.

Latin America is attractively valued compared with other regions and its own history.

Bear points

Higher political and currency risk in Latin America than in developed economies.

Latin American equity market can be volatile.

Latin America is less well researched compared with developed markets.

Analyst

Mel Jenner

+44 (0)20 3077 5700

BlackRock Latin American Investment Trust is a research client of Edison Investment Research Limited

BlackRock Latin American Investment Trust’s (BRLA’s) lead manager Sam Vecht and deputy manager Christoph Brinkmann remain optimistic about the prospects for the region. Interest rates are coming down as Latin American central banks have been more proactive than those in developed markets in raising interest rates to combat higher inflation, which should be supportive for economic growth and asset prices. Latin America has remained relatively isolated from global geopolitical conflict, enabling trade with both eastern and western nations. The region has been overlooked by global investors, which has led to very attractive valuations on both absolute and relative terms.

NAV outperformance versus the benchmark over the last 12 months

Source: Refinitiv, Edison Investment Research

Why consider BRLA?

Latin America has been out of favour with investors despite its favourable growth prospects and attractive valuations. The region makes up less than 10% of the MSCI Emerging Markets Index, while BRLA is now the only fund in the AIC Latin America sector. Unsurprisingly, given its economic dominance in Latin America, the trust’s largest exposure is to Brazil (c 60% of the fund), although the managers are not constrained by BRLA’s benchmark’s weightings; for example, there are allocations to Argentina and Panama, which are not represented in the index.

Vecht and Brinkmann are positive on the outlook for Brazil as they believe the inflation outlook is benign and the government has a relatively prudent fiscal policy. This should allow the Brazilian central bank to lower interest rates faster than the consensus expects, which in turn should lead to local equity capital inflows.

The trust’s two managers have significant experience investing in Latin America and can draw on BlackRock’s extensive resources when required; this major asset manager has made a public commitment regarding investment in the region.

BRLA has a formal dividend policy, whereby regular distributions are made based on the trust’s quarter-end NAV, which ensures that yield considerations do not affect stock selection. BRLA currently offers an attractive 5.7% dividend yield. The trust’s 11.2% discount compares with the 6.7% to 18.6% 12-month range, and the 12.7%, 10.6%, 10.6% and 11.7% average discounts over the last one, three, five and 10 years respectively.

BRLA: Interesting complement to developed markets

Latin America has been overlooked by investors and now represents less than 10% of the MSCI Emerging Markets Index. Admittedly, over the last decade, the region has performed relatively poorly compared with global indices. However, in 2023 it delivered a greater than 25% total return (in sterling terms), suggesting potential benefits of an allocation to Latin America within a broader global portfolio.

BRLA’s upside/downside analysis

Exhibit 1: BRLA’s upside/downside capture

Source: Refinitiv, Edison Investment Research. Note: Cumulative upside/downside capture calculated as the geometric average NAV total return (TR) of the fund during months with positive/negative reference index TRs, divided by the geometric average reference index TR during these months. A 100% upside/downside indicates that the fund's TR was in line with the reference index’s during months with positive/negative returns. Data points for the initial 12 months have been omitted in the exhibit due to the limited number of observations used to calculate the cumulative upside/downside capture ratios.

BRLA’s upside/downside capture over the last decade is shown in Exhibit 1. The trust’s upside capture is 105%, while its downside capture is 108%. These data suggest that BRLA is likely to modestly outperform its benchmark during periods when Latin American share prices rise and underperform to a slightly larger degree during periods of market weakness.

Market performance and valuation

Exhibit 2: Market performance

Absolute and relative index performances (last 10 years, in £ terms)

Valuation of MSCI indices (at 29 February 2024)

Source: Refinitiv, Edison Investment Research. Note: LA is Latin America and EM is emerging markets.

Source: Refinitiv, Edison Investment Research

Over the last decade, Latin America has performed broadly in line with other emerging markets (Exhibit 2, left-hand side); its outperformance in recent years has been helped by the weakness in Chinese shares. However, compared with the world market, Latin America has performed very poorly over the last 10 years. This is largely due to the dominant US market, which now makes up around 60–70% of global indices and has performed relatively strongly for much of the last decade.

Despite its relative historical performance, risk-tolerant investors may benefit from an allocation to Latin America. The region has superior growth prospects compared with developed economies, as shown by International Monetary Fund (IMF) data in Exhibit 3. This is helped by growing populations with increased spending power and global demand for its abundant natural resources. As shown in Exhibit 2, right-hand side, Latin American valuations look relatively attractive (particularly Brazil), with forward P/E and price-to-book multiples considerably lower than those of the MSCI All-Countries World Index, while also offering a much higher yield.

Exhibit 3: Higher growth prospects in Latin America compared with advanced economies

Source: International Monetary Fund World Economic Outlook January 2024, Edison Investment Research. Note: e is estimated and p is projected.

Perspectives from one of BRLA’s managers

Vecht says that there are reasons to be optimistic about Latin America. Although the region should not be considered risk free, he believes it is a worthwhile proposition for long-term investors. There has been more focus on Latin America’s resources, such as lithium and energy, partly as a replacement for Russian supplies over the last two years. The manager believes that these resources can be extracted at a favourable economic cost in an environmentally friendly way.

Latin America has kept itself apart from global geopolitical conflicts, so is able to do business with both eastern and western nations. The Mexican economy is also benefiting from Asian companies that are setting up in the northern part of the country in order to sell their products/services into the United States.

Central banks in Latin America have been more proactive than those in developed markets in raising interest rates to help combat higher inflation. Prior to the last two years, it has been 30–40 years since western countries experienced high levels of inflation, unlike in Latin America, where central banks, politicians, corporates and individuals are used to dealing with inflation and interest rates are coming down, which should be supportive for the economy and asset prices. In Brazil, the base rate rose from 2.00% in 2021 to 13.75% in 2022 and is now down to 11.25%. Vecht believes that positive real interest rates in Latin America should lead to capital inflows in the region.

Turning his attention to valuations, the manager highlights that on a forward P/E multiple basis, Latin America is trading towards the low end of its 20-year average, so looks attractive versus its own history and compared with western markets. At the end of February 2024, on a forward P/E multiple basis, Latin America was trading at a c 25% discount to emerging markets and around a 50% discount to the world market. Vecht believes that a discount versus global equities is warranted, as historically there have been periods of political instability in Latin America, but thinks the current level is too wide.

Current portfolio positioning

At the end of January 2024, BRLA’s top 10 positions made up 54.3% of the portfolio, which was a higher concentration than 51.2% 12 months earlier; eight positions were common to both periods.

Exhibit 4: Top 10 holdings (at 31 January 2024)

Company

Country

Sector

Portfolio weight %

Benchmark weight (%)

Active weight vs benchmark (pp)

31 Jan 2024

31 Jan 2023*

Petrobras - ADR**

Brazil

Energy

9.6

7.2

11.1

(1.5)

Vale - ADS

Brazil

Materials

9.0

9.1

7.3

1.7

Walmart de México y Centroamérica

Mexico

General retailing

6.1

N/A

3.4

2.7

Banco Bradesco - ADR**

Brazil

Banks

5.8

6.1

3.3

2.5

FEMSA - ADR

Mexico

Food, beverages & tobacco

4.7

5.3

4.2

0.5

B3

Brazil

Diversified financials

4.2

4.9

2.4

1.8

Ambev - ADR**

Brazil

Food, beverages & tobacco

4.1

4.8

4.7

(0.6)

Grupo Aeroportuario del Pacifico - ADS

Mexico

Airport operator

3.8

N/A

1.0

2.8

Itaú Unibanco - ADR

Brazil

Banks

3.7

3.0

5.1

(1.4)

Grupo Financiero Banorte

Mexico

Banks

3.3

5.1

4.2

(0.9)

Top 10 (% of holdings)

54.3

51.2

Source: BRLA, Edison Investment Research. Note: *N/A where not in end-January 2023 top 10. **Equity and preference shares.

The Latin American market is heavily weighted towards Brazil and Mexico, which together make up more than 85% of the benchmark. In the 12 months to the end of January 2024, the largest changes in BRLA’s geographic weightings were a new allocation to Colombia (+2.6pp), a higher exposure to Mexico (+2.5pp) and a lower weighting in Brazil (-5.1pp). At the end of January 2024, BRLA had around 5% invested in two non-index countries, Argentina (2.9%) and Panama (1.6%), with a further 1.6% in a multi-country company (see note in Exhibit 5).

Exhibit 5: Portfolio geographic exposure versus benchmark (% unless stated)

Portfolio end-
January 2024

Portfolio end-
January 2023

Change
(pp)

Active weight vs benchmark (pp)

Brazil

58.7

63.8

(5.1)

(1.9)

Mexico

27.9

25.4

2.5

(2.1)

Chile

4.7

5.7

(1.0)

(0.3)

Argentina

2.9

2.9

0.0

2.9

Colombia

2.6

0.0

2.6

1.4

Panama

1.6

2.2

(0.6)

1.6

Multi-country*

1.6

0.0

1.6

1.6

Peru

0.0

0.0

0.0

(3.2)

Total

100.0

100.0

Source: BRLA, Edison Investment Research. Note: Excludes cash. *Lundin Gold, which is a Canadian mining company with a gold mine in Ecuador.

Exhibit 6: BRLA and benchmark geographic breakdowns at 31 January 2024

Source: BRLA, Edison Investment Research

Versus the benchmark, the trust’s largest active weights were Peru (-3.2pp) and Argentina (+2.9pp). The managers have reduced BRLA’s Mexican exposure as the country has outperformed over a multi-year period and is the most exposed Latin American country to any US economic slowdown. There is also a Mexican general election in early June 2024, which could potentially increase the risk of market volatility. Vecht explains that many of BRLA’s Brazilian holdings are interest rate sensitive names such as payments acquirer PagSeguro and homebuilder EZTEC. There is a relatively new position in Lojas Renner, a Brazilian clothing retailer, and the managers expect an improvement in the company’s credit book.

The trust’s sector exposure is shown in Exhibit 7. The largest changes in the year ending 31 January 2024 were a higher weighting in consumer discretionary (+6.4pp), with lower allocations to materials (-3.2pp), real estate (-2.7pp) and financials (-2.6pp). BRLA’s largest active weights were consumer discretionary (+8.5pp) and utilities (-6.9pp).

Exhibit 7: Portfolio sector exposure versus benchmark (% unless stated)

Portfolio end-
January 2024

Portfolio end-
January 2023

Change
(pp)

Active weight vs
benchmark (pp)

Financials

21.8

24.4

(2.6)

(4.2)

Consumer staples

19.1

16.9

2.2

2.6

Materials

16.6

19.8

(3.2)

(0.8)

Industrials

11.0

12.9

(1.9)

1.0

Energy

10.9

8.8

2.1

(3.1)

Consumer discretionary

10.4

4.0

6.4

8.5

Healthcare

3.9

4.1

(0.2)

2.4

Real estate

2.7

5.4

(2.7)

1.5

Communication services

2.0

2.4

(0.4)

(2.1)

Information technology

1.6

1.3

0.3

1.1

Utilities

0.0

0.0

0.0

(6.9)

Total

100.0

100.0

Source: BRLA, Edison Investment Research. Note: Excludes cash.

Exhibit 8: BRLA and benchmark sector breakdowns at 31 January 2024

Source: BRLA, Edison Investment Research

Performance: NAV above the index over the last year

Exhibit 9: Five-year discrete performance data

12 months ending

Share price
(%)

NAV
(%)

MSCI EM Latin America (%)

CBOE UK All Companies (%)

MSCI World
(%)

29/02/20

(5.1)

(7.6)

(7.9)

(2.1)

9.6

28/02/21

(9.9)

(14.2)

(13.9)

2.8

18.8

28/02/22

13.1

12.2

19.6

16.7

15.9

28/02/23

5.3

7.3

11.2

8.2

3.2

29/02/24

14.2

18.9

17.8

0.7

20.2

Source: Refinitiv. Note: All % on a total return basis in pounds sterling.

As shown in Exhibit 10, right-hand side, absolute returns in Latin America over the last decade have been modest, at around 5% per year. However, there are periods when returns are much higher; in 2023, the MSCI EM Latin America Index appreciated by more than 25% (in sterling terms). This illustrates the potential benefits of an allocation to the region as part of a long-term global strategy.

Exhibit 10: Investment trust performance to 29 February 2024

Price, NAV and benchmark total return performance, one-year rebased

Price, NAV and benchmark total return performance (%)

Source: Refinitiv, Edison Investment Research. Note: Three-, five- and 10-year performance figures annualised.

BRLA’s relative returns are highlighted in Exhibit 11. The trust’s NAV has modestly outpaced the benchmark over the last 12 months.

Exhibit 11: Share price and NAV total return performance, relative to index (%)

 

One month

Three months

Six months

One year

Three years

Five years

10 years

Price relative to MSCI EM Latin America

(3.4)

(2.4)

(7.7)

(3.1)

(13.2)

(6.4)

(7.8)

NAV relative to MSCI EM Latin America

(0.7)

(3.8)

(5.1)

0.9

(8.6)

(8.6)

(7.3)

Source: Refinitiv, Edison Investment Research. Note: Data to end-February 2024. Geometric calculation.

General disclaimer and copyright

This report has been commissioned by BlackRock Latin American Investment Trust and prepared and issued by Edison, in consideration of a fee payable by BlackRock Latin American Investment Trust. Edison Investment Research standard fees are £60,000 pa for the production and broad dissemination of a detailed note (Outlook) following by regular (typically quarterly) update notes. Fees are paid upfront in cash without recourse. Edison may seek additional fees for the provision of roadshows and related IR services for the client but does not get remunerated for any investment banking services. We never take payment in stock, options or warrants for any of our services.

Accuracy of content: All information used in the publication of this report has been compiled from publicly available sources that are believed to be reliable, however we do not guarantee the accuracy or completeness of this report and have not sought for this information to be independently verified. Opinions contained in this report represent those of the research department of Edison at the time of publication. Forward-looking information or statements in this report contain information that is based on assumptions, forecasts of future results, estimates of amounts not yet determinable, and therefore involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of their subject matter to be materially different from current expectations.

Exclusion of Liability: To the fullest extent allowed by law, Edison shall not be liable for any direct, indirect or consequential losses, loss of profits, damages, costs or expenses incurred or suffered by you arising out or in connection with the access to, use of or reliance on any information contained on this note.

No personalised advice: The information that we provide should not be construed in any manner whatsoever as, personalised advice. Also, the information provided by us should not be construed by any subscriber or prospective subscriber as Edison’s solicitation to effect, or attempt to effect, any transaction in a security. The securities described in the report may not be eligible for sale in all jurisdictions or to certain categories of investors.

Investment in securities mentioned: Edison has a restrictive policy relating to personal dealing and conflicts of interest. Edison Group does not conduct any investment business and, accordingly, does not itself hold any positions in the securities mentioned in this report. However, the respective directors, officers, employees and contractors of Edison may have a position in any or related securities mentioned in this report, subject to Edison's policies on personal dealing and conflicts of interest.

Copyright: Copyright 2024 Edison Investment Research Limited (Edison).

Australia

Edison Investment Research Pty Ltd (Edison AU) is the Australian subsidiary of Edison. Edison AU is a Corporate Authorised Representative (1252501) of Crown Wealth Group Pty Ltd who holds an Australian Financial Services Licence (Number: 494274). This research is issued in Australia by Edison AU and any access to it, is intended only for "wholesale clients" within the meaning of the Corporations Act 2001 of Australia. Any advice given by Edison AU is general advice only and does not take into account your personal circumstances, needs or objectives. You should, before acting on this advice, consider the appropriateness of the advice, having regard to your objectives, financial situation and needs. If our advice relates to the acquisition, or possible acquisition, of a particular financial product you should read any relevant Product Disclosure Statement or like instrument.

New Zealand

The research in this document is intended for New Zealand resident professional financial advisers or brokers (for use in their roles as financial advisers or brokers) and habitual investors who are “wholesale clients” for the purpose of the Financial Advisers Act 2008 (FAA) (as described in sections 5(c) (1)(a), (b) and (c) of the FAA). This is not a solicitation or inducement to buy, sell, subscribe, or underwrite any securities mentioned or in the topic of this document. For the purpose of the FAA, the content of this report is of a general nature, is intended as a source of general information only and is not intended to constitute a recommendation or opinion in relation to acquiring or disposing (including refraining from acquiring or disposing) of securities. The distribution of this document is not a “personalised service” and, to the extent that it contains any financial advice, is intended only as a “class service” provided by Edison within the meaning of the FAA (i.e. without taking into account the particular financial situation or goals of any person). As such, it should not be relied upon in making an investment decision.

United Kingdom

This document is prepared and provided by Edison for information purposes only and should not be construed as an offer or solicitation for investment in any securities mentioned or in the topic of this document. A marketing communication under FCA Rules, this document has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of the dissemination of investment research.

This Communication is being distributed in the United Kingdom and is directed only at (i) persons having professional experience in matters relating to investments, i.e. investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "FPO") (ii) high net-worth companies, unincorporated associations or other bodies within the meaning of Article 49 of the FPO and (iii) persons to whom it is otherwise lawful to distribute it. The investment or investment activity to which this document relates is available only to such persons. It is not intended that this document be distributed or passed on, directly or indirectly, to any other class of persons and in any event and under no circumstances should persons of any other description rely on or act upon the contents of this document.

This Communication is being supplied to you solely for your information and may not be reproduced by, further distributed to or published in whole or in part by, any other person.

United States

Edison relies upon the "publishers' exclusion" from the definition of investment adviser under Section 202(a)(11) of the Investment Advisers Act of 1940 and corresponding state securities laws. This report is a bona fide publication of general and regular circulation offering impersonal investment-related advice, not tailored to a specific investment portfolio or the needs of current and/or prospective subscribers. As such, Edison does not offer or provide personal advice and the research provided is for informational purposes only. No mention of a particular security in this report constitutes a recommendation to buy, sell or hold that or any security, or that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person.

London │ New York │ Frankfurt

20 Red Lion Street

London, WC1R 4PS

United Kingdom

London │ New York │ Frankfurt

20 Red Lion Street

London, WC1R 4PS

United Kingdom

General disclaimer and copyright

This report has been commissioned by BlackRock Latin American Investment Trust and prepared and issued by Edison, in consideration of a fee payable by BlackRock Latin American Investment Trust. Edison Investment Research standard fees are £60,000 pa for the production and broad dissemination of a detailed note (Outlook) following by regular (typically quarterly) update notes. Fees are paid upfront in cash without recourse. Edison may seek additional fees for the provision of roadshows and related IR services for the client but does not get remunerated for any investment banking services. We never take payment in stock, options or warrants for any of our services.

Accuracy of content: All information used in the publication of this report has been compiled from publicly available sources that are believed to be reliable, however we do not guarantee the accuracy or completeness of this report and have not sought for this information to be independently verified. Opinions contained in this report represent those of the research department of Edison at the time of publication. Forward-looking information or statements in this report contain information that is based on assumptions, forecasts of future results, estimates of amounts not yet determinable, and therefore involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of their subject matter to be materially different from current expectations.

Exclusion of Liability: To the fullest extent allowed by law, Edison shall not be liable for any direct, indirect or consequential losses, loss of profits, damages, costs or expenses incurred or suffered by you arising out or in connection with the access to, use of or reliance on any information contained on this note.

No personalised advice: The information that we provide should not be construed in any manner whatsoever as, personalised advice. Also, the information provided by us should not be construed by any subscriber or prospective subscriber as Edison’s solicitation to effect, or attempt to effect, any transaction in a security. The securities described in the report may not be eligible for sale in all jurisdictions or to certain categories of investors.

Investment in securities mentioned: Edison has a restrictive policy relating to personal dealing and conflicts of interest. Edison Group does not conduct any investment business and, accordingly, does not itself hold any positions in the securities mentioned in this report. However, the respective directors, officers, employees and contractors of Edison may have a position in any or related securities mentioned in this report, subject to Edison's policies on personal dealing and conflicts of interest.

Copyright: Copyright 2024 Edison Investment Research Limited (Edison).

Australia

Edison Investment Research Pty Ltd (Edison AU) is the Australian subsidiary of Edison. Edison AU is a Corporate Authorised Representative (1252501) of Crown Wealth Group Pty Ltd who holds an Australian Financial Services Licence (Number: 494274). This research is issued in Australia by Edison AU and any access to it, is intended only for "wholesale clients" within the meaning of the Corporations Act 2001 of Australia. Any advice given by Edison AU is general advice only and does not take into account your personal circumstances, needs or objectives. You should, before acting on this advice, consider the appropriateness of the advice, having regard to your objectives, financial situation and needs. If our advice relates to the acquisition, or possible acquisition, of a particular financial product you should read any relevant Product Disclosure Statement or like instrument.

New Zealand

The research in this document is intended for New Zealand resident professional financial advisers or brokers (for use in their roles as financial advisers or brokers) and habitual investors who are “wholesale clients” for the purpose of the Financial Advisers Act 2008 (FAA) (as described in sections 5(c) (1)(a), (b) and (c) of the FAA). This is not a solicitation or inducement to buy, sell, subscribe, or underwrite any securities mentioned or in the topic of this document. For the purpose of the FAA, the content of this report is of a general nature, is intended as a source of general information only and is not intended to constitute a recommendation or opinion in relation to acquiring or disposing (including refraining from acquiring or disposing) of securities. The distribution of this document is not a “personalised service” and, to the extent that it contains any financial advice, is intended only as a “class service” provided by Edison within the meaning of the FAA (i.e. without taking into account the particular financial situation or goals of any person). As such, it should not be relied upon in making an investment decision.

United Kingdom

This document is prepared and provided by Edison for information purposes only and should not be construed as an offer or solicitation for investment in any securities mentioned or in the topic of this document. A marketing communication under FCA Rules, this document has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of the dissemination of investment research.

This Communication is being distributed in the United Kingdom and is directed only at (i) persons having professional experience in matters relating to investments, i.e. investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "FPO") (ii) high net-worth companies, unincorporated associations or other bodies within the meaning of Article 49 of the FPO and (iii) persons to whom it is otherwise lawful to distribute it. The investment or investment activity to which this document relates is available only to such persons. It is not intended that this document be distributed or passed on, directly or indirectly, to any other class of persons and in any event and under no circumstances should persons of any other description rely on or act upon the contents of this document.

This Communication is being supplied to you solely for your information and may not be reproduced by, further distributed to or published in whole or in part by, any other person.

United States

Edison relies upon the "publishers' exclusion" from the definition of investment adviser under Section 202(a)(11) of the Investment Advisers Act of 1940 and corresponding state securities laws. This report is a bona fide publication of general and regular circulation offering impersonal investment-related advice, not tailored to a specific investment portfolio or the needs of current and/or prospective subscribers. As such, Edison does not offer or provide personal advice and the research provided is for informational purposes only. No mention of a particular security in this report constitutes a recommendation to buy, sell or hold that or any security, or that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person.

London │ New York │ Frankfurt

20 Red Lion Street

London, WC1R 4PS

United Kingdom

London │ New York │ Frankfurt

20 Red Lion Street

London, WC1R 4PS

United Kingdom

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