• Christopher Hall

Trumping your yield from Utilities

Infrastructure has ridden a tailwind since Trump's election, part of The ‘Trump Trade’.

However, as the Citi team noted a month ago, The 'Trump Trade' high tide has lifted all boats, but not justifiably.

Just because an asset or fund is in infrastructure, does not mean it suddenly improves because the spending over the next 3-5 years is set to increase. Many infrastructure assets will not be effected.

The same reasoning goes to the companies who will work on the projects - the builders, engineers etc. Many of those builders will not see a cent of this spend.

While 6% yield from infrastructure assets is nice, it's not as fun after a -4%, -6% or -10% share price performance for the year.

The net result is that this area has seen share prices increase to the extent that I'm not comfortable chasing.