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Data as at: 03/02/2025

Gearing

Gearing (%)
16
Net cash (%)
0
Historic gearing 3yr low/high (%)
0 / 17
Gearing range (%)
N/A
Gearing policy

The Group may employ gearing for working capital purposes, to finance acquisitions or, over the longer term, to enhance returns to investors. Gearing may be employed either at the level of the Company, at the level of any intermediate wholly owned subsidiary of the Company or at the individual Investee Company or asset level, and any limits set out in this document shall apply on a look-through basis.

Borrowing limits

The Group’s long-term gearing is expected to be between 20% and 35% of Gross Asset Value, and shall not exceed a maximum of 50% of Gross Asset Value, calculated at the time of drawdown.

Ways in which investment companies can magnify income and capital returns, but which can also magnify losses.

At its simplest, gearing means borrowing money to buy more assets in the hope the company makes enough profit to pay back the debt and interest and leave something extra for shareholders.

how gearing works table

However, if the investment portfolio doesn’t perform well, gearing can increase losses. The more an investment company gears, the higher the risk.

Investment companies can usually borrow at lower rates of interest than you’d get as an individual. They also have flexible ways to borrow – for example they might get an ordinary bank loan or, for split capital investment companies, issue different classes of share.

Not all investment companies use gearing, and most use relatively low levels of gearing.

An indication of the maximum and minimum levels that the company would expect to be geared in normal market conditions.

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