TRUST WATCH: Baker Steel Resources

BAKER STEEL RESOURCES: Targets unlisted natural resources firms and undervalued listed companies

What is it? The trust invests mainly in natural resources firms which are not listed on the stock market. 

It will also invest in listed companies which it thinks are undervalued. It aims to grow investors’ capital long-term.

What does the manager invest in? Its largest holdings are in Zimbabwe’s Bilboes Gold, Australian coal company Futura Resources, and the Russian miner Polar Acquisition.

What do the experts like? James Burns, of Smith & Williamson, notes it has a decent exposure to gold and silver.

This could be good for anyone worried about inflation, as they are often seen as a hedge against rising prices. 

It is also trading at a relatively large discount to the underlying value of its assets.

Any downsides? Burns says there is potentially higher risk because it invests in firms which aren’t listed so it cannot easily sell them if anything goes wrong.

Its shares are also not particularly liquid, so may not be easy to buy and sell in a hurry.

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