UK Equity Income

Equity income strategies focus on those companies that pay a dividend to shareholders. Companies that prioritise dividend payouts tend to be more established and stable companies, with steady profits, and therefore an equity income strategy will often prove more defensive in falling markets, though may lag a rapidly rising market. Dividends reinvested over time can have a powerful compounding effect. 
In general UK equity income fund managers are striving to find those companies where the dividend is high, stable and secure, and blend them in a portfolio. They will seek to avoid those companies where a dividend cut is likely, as this will depress the share price. Some strategies will put particular emphasis on those companies paying a growing dividend; others will seek a high absolute dividend. There are also smaller companies income strategies, which allow investors to balance income with capital growth. 
Equity income investing is thought to bring its own valuation discipline. The income yield on any stock is expressed as a percentage of the share price. If the share price rises, that income falls and therefore income investors are unlikely to buy companies that are very expensive because the income would be low. 

Introduction to UK Equity Income

Equity income strategies focus on those companies that pay a dividend to shareholders. Companies that prioritise dividend payouts tend to be more established and stable companies, with steady profits, and therefore an equity income strategy will often prove more defensive in falling markets, though may lag a rapidly rising market. Dividends reinvested over time can have a powerful compounding effect. 

In general UK equity income fund managers are striving to find those companies where the dividend is high, stable and secure, and blend them in a portfolio. They will seek to avoid those companies where a dividend cut is likely, as this will depress the share price. Some strategies will put particular emphasis on those companies paying a growing dividend; others will seek a high absolute dividend. There are also smaller companies income strategies, which allow investors to balance income with capital growth. 

Equity income investing is thought to bring its own valuation discipline. The income yield on any stock is expressed as a percentage of the share price. If the share price rises, that income falls and therefore income investors are unlikely to buy companies that are very expensive because the income would be low.

Equity income strategies focus on those companies that pay a dividend to shareholders. Companies that prioritise dividend payouts tend to be more established and stable companies, with steady profits, and therefore an equity income strategy will often prove more defensive in falling markets, though may lag a rapidly rising market. Dividends reinvested over time can have a powerful compounding effect. In general UK equity income fund managers are striving to find those companies where the dividend is high, stable and secure, and blend them in a portfolio. They will seek to avoid those companies where a dividend cut is likely, as this will depress the share price. Some strategies will put particular emphasis on those companies paying a growing dividend; others will seek a high absolute dividend. There are also smaller companies income strategies, which allow investors to balance income with capital growth. Equity income investing is thought to bring its own valuation discipline. The income yield on any stock is expressed as a percentage of the share price. If the share price rises, that income falls and therefore income investors are unlikely to buy companies that are very expensive because the income would be low. 

The tax treatment of investments is subject to tax law and HMRC practice which are subject to change.

OEICs and Unit Trusts

Name1 Year (%)3 Years (%)5 Years (%)Fund Size (M)Yield (%)
AXA Framlington Blue Chip Equity Income Z Acc9.8036.0062.4195.043.94Buy
AXA Framlington Monthly Income Z Acc17.1441.6789.30278.034.17Buy
Aberdeen UK Equity Income I Acc6.6728.6144.46171.583.90Buy
Artemis Income I Acc12.9441.5169.656,340.393.69Buy
Aviva Inv UK Equity Income 2 Acc11.5343.8071.96953.993.55Buy
Barclays UK Equity Income R Acc GBP13.3536.9371.83158.703.90Buy
Barclays UK Equity Income S2 R Acc GBP13.3336.9372.16184.404.30Buy
BlackRock UK Income D Acc10.4445.6964.29414.463.92Buy
CF Canlife UK Equity Income C Acc GBP5.6439.3658.15199.843.64Buy
CF Miton UK Multi Cap Income B Inst Acc14.2150.89116.74679.244.10Buy
CF Woodford Equity Income C Acc GBP0.6134.47-8,851.153.46Buy
F&C Responsible UK Income 2 Acc11.7242.2570.80329.513.20Buy
F&C UK Equity Income 2 Acc8.4139.1052.3862.353.10Buy
FP Miton Income B Acc9.3647.6268.81191.214.30Buy
Fidelity Enhanced Income Y Acc3.2024.8245.58552.006.37Buy
Fidelity Enhanced Income W Acc3.3925.5142.61552.006.32Buy
Franklin UK Equity Income W Acc10.3348.7581.15471.774.13Buy
HC Charteris Premium Income Inst Acc14.9537.1828.8211.901.39Buy
HL Multi Manager Income & Growth A Acc10.9335.7074.333,202.563.94Buy
HSBC Income C Acc7.8029.8849.05202.043.84Buy

OEICs and Unit Trusts

Name1 Year (%)3 Years (%)5 Years (%)Fund Size (M)Yield (%)
AXA Framlington Blue Chip Equity Income Z Inc9.7936.0662.4295.044.09Buy
AXA Framlington Monthly Income Z Inc17.1641.6089.19278.034.25Buy
Aberdeen UK Equity Income I Inc6.6928.5644.44171.583.90Buy
Allianz UK Equity Income C Inc14.4637.5260.2568.554.02Buy
Artemis Income I Inc12.9441.5469.706,340.393.80Buy
Aviva Inv UK Equity Income 211.5343.8171.95953.993.75Buy
Barclays UK Equity Income R Dis GBP13.3736.9271.96158.704.10Buy
Barclays UK Equity Income S2 R Dis GBP13.3236.6971.81184.404.30Buy
BlackRock UK Income D Inc10.3845.7364.29414.463.95Buy
CF Canlife UK Equity Income C Inc GBP5.6539.3658.98199.843.75Buy
CF Miton UK Multi Cap Income B Inst Inc14.2150.88116.64679.244.22Buy
CF Woodford Equity Income C Inc GBP0.6034.44-8,851.153.53Buy
Castlefield B.E.S.T Income Inst Inc10.2332.1953.9227.473.80Buy
Castlefield B.E.S.T Income Charity Inc10.2330.5552.0827.473.80Buy
F&C Responsible UK Income 2 Inc11.7242.2570.77329.513.80Buy
F&C UK Equity Income 2 Inc8.1337.9048.9562.353.60Buy
FP Miton Income B Inc9.3847.6868.94191.214.46Buy
Fidelity Enhanced Income W Inc3.3425.5542.79552.006.95Buy
Fidelity Enhanced Income Y Inc3.2124.9041.29552.007.01Buy
Fidelity Enhanced Income W Monthly Inc3.4225.4642.54552.006.99Buy

Investment Trusts

Name1 Year (%)3 Years (%)5 Years (%)DiscountNAV
Blackrock Income And Growth Investment Trust Plc Ord 1P12.9143.5176.84-1.76209.70Buy
British & American IT PLC Ord-7.5110.5149.0720.4858.10Buy
Chelverton Small Companies Dividend Trust plc Ordinary Shares45.75100.63242.652.40263.91Buy
Chelverton Small Companies Dividend Trust plc Zero Dividend Preference Shares1.8613.2227.741.63134.80Buy
Dunedin Income Growth Investment Trust PLC Ord 25p12.1024.3342.77-9.73292.45Buy
Edinburgh Investment Tst plc4.1135.9165.85-8.06770.08Buy
F&C Capital & Income IT PLC Ord20.8858.4976.181.35326.09Buy
Finsbury Growth & Income Trust PLC18.2768.59122.440.86751.53Buy
Invesco Income Growth Trust plc13.5731.3059.80-9.59332.91Buy
JP Morgan Elect Managed Income13.6934.7569.68-2.74116.70Buy
JP Morgan Income & Capital Trust plc Ord22.3640.89104.30-7.56102.50Buy
JP Morgan Income & Capital Trust plc Package Units16.5126.5471.41-5.45392.40Buy
JP Morgan Income & Capital Trust plc ZDP3.0013.8635.120.85187.40Buy
JP Morgan Claverhouse IT plc24.2744.6795.64-7.35763.60Buy
Lowland Investment Company Ord20.8234.4775.53-7.421,636.40Buy
Merchants Trust PLC20.6331.7768.51-5.64519.01Buy
Miton The Investment Company Ord2.967.6091.90-5.26367.05Buy
Murray Income Trust PLC Ord 25p13.5225.8044.56-8.02861.07Buy
Perpetual Income and Growth Investment Trust plc8.7020.8363.38-8.62422.95Buy
Schroder Income Growth19.9237.0073.15-8.33316.35Buy

ETFs

Name6 Months (%)1 Year (%)3 Years (%)5 Years (%)CurrencySector
Amundi FTSE 100 UCITS ETF C GBP4.8011.5035.2852.59GBPEquity - UKBuy
BMO Enhanced Income UK Equity UCITS ETF----GBPEquity - UKBuy
BMO MSCI UK Income Leaders4.3413.47--GBPEquity - UKBuy
DB X-Trackers FTSE 100 UCITS ETF (DR) - Income 1D GBP4.9111.6535.5152.80GBPEquity - UKBuy
DB X-Trackers FTSE 250 UCITS ETF (DR) 1D GBP5.3715.4249.6689.20GBPEquity - UKBuy
DB X-Trackers FTSE All Share UCITS ETF (DR) 1D GBP5.0412.4837.9558.29GBPEquity - UKBuy
DB X-Trackers FTSE 100 Equal Weight UCITS ETF (DR) 1D GBP4.7714.07--GBPEquity - UKBuy
DB X-Trackers FTSE 100 Short Daily UCITS ETF GBP-5.49-12.12-32.78-42.22GBPEquity - UKBuy
DB X-Trackers FTSE 100 UCITS ETF (DR) 1C GBP4.9311.7836.16-GBPEquity - UKBuy
ETFS 3x Daily Short FTSE 100-16.29-32.83-74.32-GBXEquity - UKBuy
ETFS 3x Daily Long FTSE 10012.7332.8689.49-GBXEquity - UKBuy
ETFS FTSE 100 Leveraged (Daily 2x) GO UCITS ETF GBP8.3220.8059.4286.74GBPEquity - UKBuy
ETFS FTSE 100 Super Short Strategy (Daily 2x) GO UCITS ETF GBP-10.80-22.71-56.88-70.48GBPEquity - UKBuy
First Trust United Kingdom AlphaDEX UCITS ETF B Inc GBP6.3614.48--GBPEquity - UKBuy
First Trust United Kingdom AlphaDEX UCITS ETF A Acc GBP6.3714.4841.59-GBPEquity - UKBuy
HSBC FTSE 1004.9011.6935.5252.53GBPEquity - UKBuy
HSBC FTSE 2505.2515.2649.5388.72GBPEquity - UKBuy
Lyxor UCITS ETF FTSE 250 GBP5.3215.3950.2190.15GBPEquity - UKBuy
Lyxor UCITS ETF FTSE 100 Monthly Hedged C USD5.2412.32--USDEquity - UKBuy
Lyxor UCITS ETF FTSE 100 C GBP4.9511.8136.4554.28GBPEquity - UKBuy

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