Are you looking for an annual yield of 13.9% Consider these cheap investment trusts!

Investment trusts can deliver great returns while allowing investors to diversify effectively. But times have been tough for these companies lately.

Victoria Hasler, head of fund research at Hargreaves Lansdownenotes that

Rising interest rates have made income look less attractive than before, rising discount rates have weighed on asset valuations, and active managers have struggled in markets led by a few large stocks.

He also notes that “over the last few years we have seen good quality investment trusts trading at huge discounts“. This remains the case as we enter the new year.

So I’m looking for the best values ​​I can think of today. Here are two of my favorites.

Octopus Renewables Infrastructure Trust

Donald Trump’s return to the presidency sent shockwaves through renewable energy stocks. Even the most inexperienced companies in the US have been downgraded following the November election.

This presents a great opportunity to buy the dip in my opinion. One such business that caught my attention is Octopus Renewables Infrastructure Trust (LSE:ORIT).

At 63.5p per share, it trades at a steep 38.7% discount to its net asset value (NAV) per share of 103.6p.

paid a dividend of 9.5 %. To put this in context, the average of FTSE 100 shares retreated 3.6%.

I love this trust because of the great variety it offers. It generates power for offshore and onshore wind turbines and solar farms. This allows consistent energy production throughout the seasons, and increases efficiency by using technology built in a unique environment.

With assets across the British Isles, Finland, Germany, and France, it can always make a profit despite bad weather or regulatory issues in one or two regions.

Importantly, it also has no exposure to the US, raising uncertainty about the future of green policies under President-elect Trump.

Such fears – however unlikely – may continue to weigh on Octopus’ share price. But in the long run I think it could prove a solid investment.

Gore Street Energy Storage Fund

I Gore Street Energy Storage Fund (LSE:GSF) shares several characteristics with the Octopus trust.

Its share price has fallen due to declining confidence in renewable energy. This is because the demand for its technology is tied to the growth of the renewable sector, where it provides a stable flow of energy even during bad weather.

Gore Street is also vulnerable to higher interest rates that lower asset prices and increase borrowing costs.

But like Octopus, it also offers excellent value that I find hard to ignore. At 50.6p per share, the trust trades at a 49.7% discount to its NAV of 100.7p per share.

At that time, the annual yield of 13.9 %.

This is another stock with huge long-term potential as the world transitions away from fossil fuels. Bloomberg estimates that the global energy storage market will grow at an annual rate of 21% between now and 2030.

And Gore Street is growing fast enough to charge long-term income. Operating capacity jumped 45% in the 12 months to September, reaching 421.4 MW.