Hipgnosis Songs Fund: heart of gold or heart of glass? - Investors Chronicle
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Hipgnosis Songs Fund: heart of gold or heart of glass? - Investors Chronicle

Surely of all the companies whose shares are listed in London, the one with the coolest name is Hipgnosis (SONG)? Most fabricated company names try too hard to be clever and end up being stupid; come in Diageo (DGE) or Mondelez (US:MDLZ). From the past we have gems of corporate nomenclature such as Spong, whose bosses thought it would be a good idea to call it Lionheart; then the conglomerate that started out as The Birmingham Tyre & Rubber company ended up as invensys (including a compulsorily lower case ‘i’), and even Woolworth became Kingfisher (KGF).
Granted, we get used to these contrivances so that their silliness becomes normal. No such problems with Hipgnosis, however. For a company whose claimed expertise is understanding what moves and shakes the modern music industry, what name could be better than this elegantly understated pun blending Greek with American slang?
The only trouble is that the company’s hypnotic effect on investors is wearing thin. The trance that sent its share price to 126p in early 2021 has been replaced by a dull reality some 30 per cent below that level. At its current 87p, the price also sits 48 per cent below the net asset value (NAV) of a company that basically comprises the publishing rights to more than 65,000 pieces of music. As discounts to net assets go – and, after all, Hipgnosis is a closed-end fund, much like an investment trust – that’s quite a gap.
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