ISA Choices Focus on Income
Focus on Income
This year we have a selection of funds across the spectrum of income producing assets.
Aberdeen European High Yield Bond
The fund aims to deliver attractive levels of income, without undue levels of market volatility, by investing into a diversified portfolio of European sub-investment grade bonds in companies that can perform through a full investment cycle.
It is run on a team basis by experienced long-term investors in the European bond market. The fund has a high-conviction buy and hold strategy to minimise turnover and reduce transaction costs. Diversification is achieved by holding a minimum of 40 issuers in the fund. The fund is currency hedged to sterling.
Artemis High Income Fund
The fund is a strategic bond fund and aims to provide an above average level of income along with a rising income over time and some prospect for capital growth over the long term. Its mandate allows it the flexibility to invest across the range of bonds both in the UK and globally. It can hold up to 20% of assets in stocks and shares and currently (Feb 2018) allocates around 15% to equities.
Watch Alex Ralph, manager of the fund, talk about how she manages the fund by using the link below.
LF Woodford Income Focus
Whilst the last year has not been an easy one for Woodford he remains staunchly committed to his own investment strategies and processes and is confident that he will be vindicated in the long run. This fund was launched back in April 2017 and aims to deliver an income of 5p per share per annum, with the prospect of modest, sustainable income growth over a five-year rolling period thereafter. It has no geographical constraints, will only invest in quoted assets and aims to offer investors an attractive yield from a portfolio of stocks and shares.
Schroder Income Maximiser
The Maximiser strategy targets an annual yield of 7%, though this is not guaranteed. In addition to the income from dividends in the Schroder Income fund a tested “covered call option” strategy is employed. Financial institutions enter into contracts relating to individual shares in the Income fund whereby they agree to provide an upfront payment in exchange for any rise in the share price above a certain level over a set period of time. The fund managers sell these option contracts on a recurring basis, typically for three month periods. The upfront payments from buyers help boost the natural annual dividend. For more information please visit the Schroders website.