JEFF PRESTRIDGE: Ring investors’ bell, Chancellor – axe stamp duty on shares

Visiting the London Stock Exchange last Friday to ‘ring’ the opening bell with investment trust chairman Neil Rogan brought memories flooding back of my 40 years working in the City.

It was opposite the LSE’s impressive building on Paternoster Square – in the shadow of St Paul’s Cathedral – that I started my London journey: as a report writer for property company Debenham Tewson & Chinnocks (DT&C).

Although I was rather underwhelming at my work and somewhat distracted by falling in love for the first time, I did become an expert on commercial rents and office availability in the City.

Without DT&C giving me the bug for writing, I wouldn’t have joined monthly magazine Money Management before going on to enjoy 35 years as a financial journalist with The Sunday Telegraph and The Mail on Sunday. Thank you, DT&C.

Friday’s visit to the LSE was a result of an interview I held with Mr Rogan five days ago to discuss the creation of investment trust, Invesco Asia Dragon, formed by the merger of two existing funds.

As chairman of the new trust, Mr Rogan said he would be delighted if I joined him in ringing the bell to welcome the new £800million fund to the stock exchange. Inquisitive as I am, I jumped at the chance and what fun it was, hobnobbing with the City’s great and good at first light.

On the button: Trust chairman Neil Rogan and Jeff ring in the start of trading at the stock exchange

Yet, my visit was also fuelled by a sense of solidarity – for both the investment trust industry (custodians of our long-term savings) and the LSE (the exchange through which shares are traded). The two of them are now under attack.

In the case of trusts, American hedge fund manager Saba Capital is intent on tearing apart a vital part of the savings and investment market that has existed since 1868 when the first investment trust Foreign & Colonial (now known as F&C) was established.

As for the LSE, it is witnessing a worrying shrinkage in the UK stock market as companies are taken over by private equity and foreign rivals.

This is being exacerbated by other companies delisting from the UK stock market in favour of other markets (primarily the United States) so as to attract a wider investor audience.

Last week, Unilever became the latest company to snub the LSE by stating it would use Amsterdam as the main listing for shares in its ice cream business, which includes Magnum and Ben & Jerry’s.

Indeed, reduced investor interest in UK equities is one of the reasons why Saba has gone investment trust hunting. By building big stakes in tens of trusts whose shares trade at significant discounts to the value of their underlying assets, it has been able to agitate for change.

So far, Saba has made no headway, having been resoundingly rebuffed by shareholders of seven trusts that it wanted ultimately to pool together and manage under its own brand.

Yet it isn’t giving up. Last week, Saba said it would be asking shareholders of four trusts to vote on plans to convert them from listed vehicles to so called open-ended funds. In other words, the trusts would be removed from the stock market and run as unit trusts.

In theory, a technical change, but for investors a potentially alarming one given the difficulties unit trusts can experience when markets are falling and fund investors are running towards the exit.

In such situations, the fund managers have no choice but to either sell their most liquid assets to meet the tide of redemptions – or gate the fund and prevent investors from exiting. It is what happened at Woodford Equity Income (a fund no more) and numerous property funds.

With investment trusts, investors can nearly always trade their shares, although they may not get the price merited by the value of the underlying assets.

Cycling back to work on Friday morning after the bell-ringing, I was reminded of what Baroness Altmann (a champion of investment trusts and investing in general) has said about Saba’s latest move.

Turning investment trusts into open-ended funds, she said, would destroy their long-term value, harm an already damaged UK stock market, and inhibit economic growth, which is currently limping along at 0.1 per cent. As usual, she has hit the nail bang on the head. Saba, hands off our investment trusts.

One final point on the LSE. There is one simple thing that the Government could do to revitalise the UK stock market – and it’s a measure long called for by my City colleagues at the Daily Mail. It is to scrap 0.5 per cent stamp duty on share purchases, rather than the growing call within some City circles for a revamp of the Isa so it is more investment-centric.

Isas are fine as they are, offering savers and investors alike the opportunity to park cash or shares inside them. That choice should remain, and the government would be making a grave mistake if it tinkered with it.

As Money Mail said on Wednesday: ‘Hands off our cash Isas.’

Fix our train network before I go off the rails

Infuriating: Trains can vanish from station departure boards

Our country’s disjointed and crumbling train network constantly infuriates me.

And as someone who no longer owns a car (a personal choice), I’m dependent upon it to commute back and forth to work – and to go up and down the country to meet with friends and foes alike.

My gripes are as long as a family’s weekly shopping list.

Foremost among them are: trains cancelled at short notice even though National Rail and Trainline often assure you until the very last minute that they are running; poor timetabling; and recorded messages on board trains warning you about fare dodging which are then repeated at every station the train stops at (headache-inducing).

I now add to this the trains that suddenly disappear from a station departure board, even though they have yet to leave their platform.

Although we’re told London King’s Cross station is trialling this ‘three-minute rule’, which means departure details are removed from station boards 180 seconds before a train leaves, it’s happening elsewhere.

Seven days ago I rocked into London Paddington after a splendid afternoon with my partner looking around Apsley House, the former home of the first Duke of Wellington (the nude statue of Napoleon as Mars the Peacemaker is worth the entrance fee alone).

Looking at the departure board, I saw that the 16.20 to Oxford was the first train that would stop at Reading, from where we could get a connecting train to my hometown of Wokingham.

But it said the train was delayed. We waited, only for it to disappear from the departure board.

We assumed it had been cancelled and got on the next train heading to Reading.

It was only once we were well on our way that my partner checked Trainline and discovered that the Oxford train had actually departed Paddington ahead of the one that we were on.

Friends tell me this has also happened to them when travelling out of Paddington.

Fix the broken network, make travelling a joyous experience, and curb the rash of cancelled trains because of crew shortages. They’re the issues that need urgently addressing.