What is striking is the discount. At 18.8pc, it is at the upper end of its range over the past year, 2pc-19pc, and not far off twice its 11pc average over the same period.
“This does seem reasonably wide,” Mr Scouller said. “It is driven by sentiment. Because FTSE 250 companies tend to be more focused on the domestic economy, they were very hard hit in March.”
If the market can continue its slow recovery from the depths seen then, as the lockdown is gradually eased, and if renewed appetite for medium-sized British stocks attracts buyers to this trust, investors could benefit twice over. And that’s before any possible extra gains from good stock selection on the part of the fund’s managers.
One reason for the trust’s wide discount could be its inclusion of “value” stocks, whose long-standing unpopularity has only deepened.
The fund is not an out-and-out value portfolio along the lines of Aberforth Smaller Companies, first tipped here in January 2018, but owns a mixture of value and growth stocks.
This too could put wind in its sails as we finally begin to move on from lockdown.
“Some value stocks have been under pressure because they often have weak balance sheets, which can accentuate problems during a recession,” said Mr Scouller. “And they are often income stocks, so those that have had to suspend their dividend have also been punished by investors.”
But concerns over the risks posed by weak balance sheets should ease once the economy picks up, he said, and the resumption of dividends should also be welcomed by the market.
The trust’s inclusion of value or income stocks has allowed it to pay a generous dividend: last year’s payment of 18.5p equates to a 4.4pc yield at the current share price.