£1.6bn Mercantile trust managers poised to take advantage of sell-off

Cash levels increased

The managers of the Mercantile investment trust upped their cash levels before the recent sell-off, leaving them in a prime position to take advantage of opportunities created by volatile markets.

Guy Anderson (pictured), who runs the trust alongside Martin Hudson at J.P. Morgan Asset Management, said the trust had gradually moved away from being geared in the last three years and is now holding a modest amount of cash. “We are currently 4.6% net cash. We ended the half year with 2.6% net cash and are being conservative with our gearing because we consider valuations to be less compelling. “That (holding) leaves us in a good position to access the opportunities thrown up by the period of heightened volatility, but it does depend on what the drivers were for that volatility,” he...