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 Acc8.5518.7156.4092.623.96Buy
AXA Framlington Monthly Income Z Acc15.2529.1687.45265.104.21Buy
Aberdeen UK Equity Income I Acc7.5111.8539.93166.723.90Buy
Artemis Income I Acc11.0824.1665.376,398.013.81Buy
Aviva Inv UK Equity Income 2 Acc10.6528.3165.53944.633.70Buy
Barclays UK Equity Income R Acc GBP11.0622.5464.15159.603.90Buy
Barclays UK Equity Income S2 R Acc GBP11.0022.3064.53185.304.30Buy
BlackRock UK Income D Acc9.4728.0559.61411.674.06Buy
CF Canlife UK Equity Income C Acc GBP5.3923.9153.82195.763.74Buy
CF Miton UK Multi Cap Income B Inst Acc14.7741.08119.52951.404.14Buy
CF Woodford Equity Income C Acc GBP-1.3323.58-8,963.173.43Buy
F&C Responsible UK Income 2 Acc8.6728.6667.14318.893.30Buy
F&C UK Equity Income 2 Acc7.1921.9947.0160.563.20Buy
FP Miton Income B Acc9.1629.2062.97186.124.27Buy
Fidelity Enhanced Income Y Acc1.8112.9343.80552.006.50Buy
Fidelity Enhanced Income W Acc1.9913.5040.84552.006.44Buy
Franklin UK Equity Income W Acc10.0331.2975.70420.424.07Buy
HC Charteris Premium Income Inst Acc13.3820.4522.4811.801.39Buy
HL Multi Manager Income & Growth A Acc9.2923.6067.343,087.103.96Buy
HSBC Income C Acc7.0215.8245.51193.573.64Buy

OEICs and Unit Trusts

Name1 Year (%)3 Years (%)5 Years (%)Fund Size (M)Yield (%)
AXA Framlington Blue Chip Equity Income Z Inc8.6018.7456.5892.624.12Buy
AXA Framlington Monthly Income Z Inc15.2629.1487.30265.104.30Buy
Aberdeen UK Equity Income I Inc7.5211.8039.91166.723.90Buy
Allianz UK Equity Income C Inc14.1019.0454.5766.804.19Buy
Artemis Income I Inc11.0824.1765.416,398.013.93Buy
Aviva Inv UK Equity Income 210.6528.3165.53944.633.80Buy
Barclays UK Equity Income R Dis GBP11.0822.5364.29159.604.10Buy
Barclays UK Equity Income S2 R Dis GBP10.9922.0864.17185.304.30Buy
BlackRock UK Income D Inc9.4528.0659.64411.674.08Buy
CF Canlife UK Equity Income C Inc GBP5.3823.9054.64195.763.85Buy
CF Miton UK Multi Cap Income B Inst Inc14.7741.07119.42951.404.25Buy
CF Woodford Equity Income C Inc GBP-1.3423.56-8,963.173.51Buy
Castlefield B.E.S.T Income Inst Inc8.3020.6949.6426.973.81Buy
Castlefield B.E.S.T Income Charity Inc8.3019.1947.8726.973.81Buy
F&C Responsible UK Income 2 Inc8.6128.5767.02318.893.90Buy
F&C UK Equity Income 2 Inc6.9020.9643.6960.563.80Buy
FP Miton Income B Inc9.1629.2363.08186.124.43Buy
Fidelity Enhanced Income W Inc1.9413.5340.97552.007.08Buy
Fidelity Enhanced Income Y Inc1.8112.9239.56552.007.15Buy
Fidelity Enhanced Income W Monthly Inc2.0013.4440.77552.007.07Buy

Investment Trusts

Name1 Year (%)3 Years (%)5 Years (%)DiscountNAV
Blackrock Income And Growth Investment Trust Plc Ord 1P10.2629.5270.71-1.45201.43Buy
British & American IT PLC Ord16.1027.5185.2846.3058.10Buy
Chelverton Small Companies Dividend Trust plc Ordinary Shares35.9174.66233.17-3.40259.83Buy
Chelverton Small Companies Dividend Trust plc Zero Dividend Preference Shares1.4912.8130.621.68134.24Buy
Dunedin Income Growth Investment Trust PLC Ord 25p7.998.8934.80-9.76279.81Buy
Edinburgh Investment Tst plc-1.5826.5662.10-7.23748.08Buy
F&C Capital & Income IT PLC Ord14.9233.0867.832.21309.04Buy
Finsbury Growth & Income Trust PLC17.1252.60119.421.23726.05Buy
Invesco Income Growth Trust plc4.8820.3455.88-9.81325.56Buy
JP Morgan Elect Managed Income11.9020.8062.586.72101.90Buy
JP Morgan Income & Capital Trust plc Ord26.1029.60110.95-1.3596.30Buy
JP Morgan Income & Capital Trust plc Package Units19.5919.3872.67-2.11379.00Buy
JP Morgan Income & Capital Trust plc ZDP3.4213.2637.211.34186.50Buy
JP Morgan Claverhouse IT plc21.4630.0793.08-6.19725.90Buy
Lowland Investment Company Ord13.6621.7076.46-6.731,591.10Buy
Merchants Trust PLC19.4913.6366.16-3.74494.48Buy
Miton The Investment Company Ord-4.87-1.09111.01-9.13365.92Buy
Murray Income Trust PLC Ord 25p9.9513.5539.58-8.15835.05Buy
Perpetual Income and Growth Investment Trust plc0.6412.0060.79-7.84406.92Buy
Schroder Income Growth14.0621.5766.81-7.50305.96Buy

ETFs

Name6 Months (%)1 Year (%)3 Years (%)5 Years (%)CurrencySector
Amundi FTSE 100 UCITS ETF C GBP-0.8611.5017.6046.12GBPEquity - UKBuy
BMO MSCI UK Income Leaders0.546.73--GBPEquity - UKBuy
DB X-Trackers FTSE 100 UCITS ETF (DR) - Income 1D GBP-0.7611.6417.7846.27GBPEquity - UKBuy
DB X-Trackers FTSE 250 UCITS ETF (DR) 1D GBP3.0511.1731.6681.69GBPEquity - UKBuy
DB X-Trackers FTSE All Share UCITS ETF (DR) 1D GBP0.0311.7320.1951.71GBPEquity - UKBuy
DB X-Trackers FTSE 100 Equal Weight UCITS ETF (DR) 1D GBP1.1111.69--GBPEquity - UKBuy
DB X-Trackers FTSE 100 Short Daily UCITS ETF GBP-0.12-12.24-22.78-39.66GBPEquity - UKBuy
DB X-Trackers FTSE 100 UCITS ETF (DR) 1C GBP-0.7411.7818.38-GBPEquity - UKBuy
ETFS 3x Daily Short FTSE 100-1.11-33.21-61.29-GBXEquity - UKBuy
ETFS 3x Daily Long FTSE 100-4.6432.4123.68-GBXEquity - UKBuy
ETFS FTSE 100 Leveraged (Daily 2x) GO UCITS ETF GBP-3.0920.6320.2170.95GBPEquity - UKBuy
ETFS FTSE 100 Super Short Strategy (Daily 2x) GO UCITS ETF GBP-0.33-22.93-43.30-67.93GBPEquity - UKBuy
First Trust United Kingdom AlphaDEX UCITS ETF B Inc GBP1.8910.24--GBPEquity - UKBuy
First Trust United Kingdom AlphaDEX UCITS ETF A Acc GBP1.5310.6124.21-GBPEquity - UKBuy
HSBC FTSE 100-0.8011.6917.7645.99GBPEquity - UKBuy
HSBC FTSE 2502.9711.0431.6181.22GBPEquity - UKBuy
Lyxor UCITS ETF FTSE 250 GBP3.0411.1532.2282.61GBPEquity - UKBuy
Lyxor UCITS ETF FTSE 100 Monthly Hedged C USD-0.6112.01--USDEquity - UKBuy
Lyxor UCITS ETF FTSE 100 C GBP-0.7411.8218.5947.68GBPEquity - UKBuy
Lyxor UCITS ETF FTSE All Share GBP0.0111.7020.4552.03GBPEquity - UKBuy

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