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 Acc9.4419.6361.9894.393.98Buy
AXA Framlington Monthly Income Z Acc15.2129.5586.93262.734.28Buy
Aberdeen UK Equity Income I Acc6.2712.9943.06170.093.90Buy
Artemis Income I Acc12.8528.6770.766,449.253.74Buy
Aviva Inv UK Equity Income 2 Acc11.9930.5972.34970.193.59Buy
Barclays UK Equity Income R Acc GBP11.9924.9268.99159.503.90Buy
Barclays UK Equity Income S2 R Acc GBP11.9124.6469.23182.204.30Buy
BlackRock UK Income D Acc10.0230.2262.23413.284.00Buy
CF Canlife UK Equity Income C Acc GBP6.0124.3057.00192.943.71Buy
CF Miton UK Multi Cap Income B Inst Acc16.0539.61125.83923.403.93Buy
CF Woodford Equity Income C Acc GBP-2.6125.00-9,207.463.49Buy
F&C Responsible UK Income 2 Acc10.4129.1172.18324.453.10Buy
F&C UK Equity Income 2 Acc8.7624.5051.8561.473.20Buy
FP Miton Income B Acc8.2731.4665.33189.253.95Buy
Fidelity Enhanced Income Y Acc2.1314.9245.45550.006.44Buy
Fidelity Enhanced Income W Acc2.2615.5442.58550.006.39Buy
Franklin UK Equity Income W Acc10.3133.5479.07404.104.01Buy
HC Charteris Premium Income Inst Acc13.1221.0430.4911.801.39Buy
HL Multi Manager Income & Growth A Acc10.0026.8571.783,167.263.93Buy
HSBC Income C Acc7.6917.6747.68197.723.59Buy

OEICs and Unit Trusts

Name1 Year (%)3 Years (%)5 Years (%)Fund Size (M)Yield (%)
AXA Framlington Blue Chip Equity Income Z Inc9.4119.6254.2194.394.14Buy
AXA Framlington Monthly Income Z Inc15.3229.7187.03262.734.37Buy
Aberdeen UK Equity Income I Inc6.2912.9443.05170.093.90Buy
Allianz UK Equity Income C Inc15.0919.6860.3069.584.05Buy
Artemis Income I Inc12.8528.7070.806,449.253.86Buy
Aviva Inv UK Equity Income 212.0030.5972.34970.193.71Buy
Barclays UK Equity Income R Dis GBP11.9924.8969.12159.504.10Buy
Barclays UK Equity Income S2 R Dis GBP11.9124.4268.88182.204.30Buy
BlackRock UK Income D Inc9.9930.3062.24413.284.01Buy
CF Canlife UK Equity Income C Inc GBP6.0125.5757.83192.943.82Buy
CF Miton UK Multi Cap Income B Inst Inc16.0639.61125.71923.404.03Buy
CF Woodford Equity Income C Inc GBP-2.6324.98-9,207.463.56Buy
Castlefield B.E.S.T Income Inst Inc7.1819.8350.3627.443.88Buy
Castlefield B.E.S.T Income Charity Inc7.1719.8250.4827.443.88Buy
F&C Responsible UK Income 2 Inc10.3829.0672.03324.453.80Buy
F&C UK Equity Income 2 Inc8.5123.4348.4761.473.70Buy
FP Miton Income B Inc8.2831.4965.44189.254.10Buy
Fidelity Enhanced Income W Inc2.3115.4942.62550.006.89Buy
Fidelity Enhanced Income Y Inc2.0914.8641.25550.006.95Buy
Fidelity Enhanced Income W Monthly Inc2.2515.4942.51550.006.96Buy

Investment Trusts

Name1 Year (%)3 Years (%)5 Years (%)DiscountNAV
Blackrock Income And Growth Investment Trust Plc Ord 1P10.7830.6374.65-1.75204.07Buy
British & American IT PLC Ord15.6938.1993.50104.5544.00Buy
Chelverton Small Companies Dividend Trust plc Ordinary Shares38.4371.38246.32-1.56257.01Buy
Chelverton Small Companies Dividend Trust plc Zero Dividend Preference Shares1.1113.16-2.11133.68Buy
Dunedin Income Growth Investment Trust PLC Ord 25p9.5410.5543.34-9.61286.26Buy
Edinburgh Investment Tst plc2.8729.5267.76-7.18767.08Buy
F&C Capital & Income IT PLC Ord17.3739.2472.570.13319.60Buy
Finsbury Growth & Income Trust PLC16.5856.00129.461.43744.38Buy
Invesco Income Growth Trust plc7.7618.2762.78-9.91329.13Buy
JP Morgan Elect Managed Income13.7324.3468.788.64102.40Buy
JP Morgan Income & Capital Trust plc Ord27.9328.92115.28-5.07100.60Buy
JP Morgan Income & Capital Trust plc Package Units20.3314.8274.33-4.11386.90Buy
JP Morgan Income & Capital Trust plc ZDP3.1512.2241.411.43185.60Buy
JP Morgan Claverhouse IT plc20.3026.6595.90-8.74735.30Buy
Lowland Investment Company Ord22.9721.4688.03-5.861,612.00Buy
Merchants Trust PLC16.4410.9268.14-6.06506.72Buy
Miton The Investment Company Ord-2.63-1.3580.73-10.04364.04Buy
Murray Income Trust PLC Ord 25p10.4516.0645.63-7.62852.98Buy
Perpetual Income and Growth Investment Trust plc3.9714.7666.47-9.05418.70Buy
Schroder Income Growth18.3824.4282.40-4.84311.07Buy

ETFs

Name6 Months (%)1 Year (%)3 Years (%)5 Years (%)CurrencySector
Amundi FTSE 100 UCITS ETF C GBP2.7111.0820.0450.67GBPEquity - UKBuy
BMO MSCI UK Income Leaders6.606.67--GBPEquity - UKBuy
DB X-Trackers FTSE 100 UCITS ETF (DR) - Income 1D GBP2.8011.1920.2050.79GBPEquity - UKBuy
DB X-Trackers FTSE 250 UCITS ETF (DR) 1D GBP6.7312.6032.1191.21GBPEquity - UKBuy
DB X-Trackers FTSE All Share UCITS ETF (DR) 1D GBP3.5611.6322.2956.81GBPEquity - UKBuy
DB X-Trackers FTSE 100 Equal Weight UCITS ETF (DR) 1D GBP5.0311.28--GBPEquity - UKBuy
DB X-Trackers FTSE 100 Short Daily UCITS ETF GBP-3.60-11.94-24.30-41.42GBPEquity - UKBuy
DB X-Trackers FTSE 100 UCITS ETF (DR) 1C GBP2.8411.3520.84-GBPEquity - UKBuy
ETFS 3x Daily Short FTSE 100-10.93-32.59-63.47-GBXEquity - UKBuy
ETFS 3x Daily Long FTSE 1006.1130.6831.74-GBXEquity - UKBuy
ETFS FTSE 100 Leveraged (Daily 2x) GO UCITS ETF GBP4.0419.6225.1981.48GBPEquity - UKBuy
ETFS FTSE 100 Super Short Strategy (Daily 2x) GO UCITS ETF GBP-7.06-22.42-45.54-69.95GBPEquity - UKBuy
First Trust United Kingdom AlphaDEX UCITS ETF B Inc GBP6.929.86--GBPEquity - UKBuy
First Trust United Kingdom AlphaDEX UCITS ETF A Acc GBP6.9010.6025.91-GBPEquity - UKBuy
HSBC FTSE 1002.8011.2920.2150.54GBPEquity - UKBuy
HSBC FTSE 2506.6712.4732.1090.74GBPEquity - UKBuy
Lyxor UCITS ETF FTSE 250 GBP6.7412.5932.7192.23GBPEquity - UKBuy
Lyxor UCITS ETF FTSE 100 Monthly Hedged C USD3.16---USDEquity - UKBuy
Lyxor UCITS ETF FTSE 100 C GBP2.8511.4121.0752.26GBPEquity - UKBuy
Lyxor UCITS ETF FTSE All Share GBP3.5511.6422.5557.16GBPEquity - UKBuy

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