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 Acc5.7919.3243.8691.983.68Buy
AXA Framlington Monthly Income Z Acc7.5830.1371.97375.892.84Buy
Aberdeen UK Equity Income I Acc0.4011.5021.91163.793.90Buy
Artemis Income I Acc11.4427.3152.126,299.923.85Buy
Aviva Inv UK Equity Income 2 Acc9.3125.5951.70971.564.10Buy
Barclays UK Equity Income (Series 2) R Acc GBP10.8524.0951.29153.304.30Buy
Barclays UK Equity Income R Acc GBP10.9024.3051.47136.203.90Buy
BlackRock UK Income D Acc5.3822.8752.60421.373.99Buy
F&C Responsible UK Income 2 Acc8.5223.6051.13341.003.00Buy
F&C UK Equity Income 2 Acc8.5029.2941.0360.493.50Buy
FP Miton Income B Acc7.7224.2052.26176.114.22Buy
Fidelity Enhanced Income Y Acc-2.528.1824.96394.006.39Buy
Fidelity Enhanced Income W Acc-2.278.7526.05394.006.31Buy
Franklin UK Equity Income W Acc7.7530.2257.84513.574.03Buy
HL Multi Manager Income & Growth A Acc5.4119.9550.143,347.193.97Buy
HSBC Income C Acc4.3514.1330.44195.493.98Buy
Insight Equity Income Booster Inst W Acc7.0820.7243.00120.037.25Buy
Insight Equity Income Inst W Acc10.5524.7250.85204.773.97Buy
Invesco Perpetual Income & Growth Z Acc1.5914.9140.02483.933.68Buy
Investec UK Equity Income I Acc3.5924.14-94.452.79Buy

OEICs and Unit Trusts

Name1 Year (%)3 Years (%)5 Years (%)Fund Size (M)Yield (%)
AXA Framlington Blue Chip Equity Income Z Inc6.1919.7944.5291.983.80Buy
AXA Framlington Monthly Income Z Inc7.5630.1071.96375.892.75Buy
Aberdeen UK Equity Income I Inc0.3911.5021.93163.793.90Buy
Allianz UK Equity Income C Inc14.9323.5943.8771.673.78Buy
Artemis Income I Inc11.4527.3452.116,299.923.97Buy
Aviva Inv UK Equity Income 29.3125.6051.74971.564.20Buy
Barclays UK Equity Income (Series 2) R Dis GBP10.3824.1651.85153.304.30Buy
Barclays UK Equity Income R Dis GBP10.5024.3652.23136.204.10Buy
BlackRock UK Income D Inc5.3522.9152.65421.373.99Buy
Castlefield B.E.S.T Sustainable Income Inst Inc-1.394.9225.9127.433.80Buy
Castlefield B.E.S.T Sustainable Income Charity Inc-1.373.6324.3727.433.80Buy
F&C Responsible UK Income 2 Inc8.4723.5851.15341.003.60Buy
F&C UK Equity Income 2 Inc8.1828.1938.3560.494.10Buy
FP Miton Income B Inc7.7224.2252.31176.114.37Buy
Fidelity Enhanced Income W Inc-2.298.7726.18394.006.80Buy
Fidelity Enhanced Income Y Inc-2.508.1524.86394.006.87Buy
Fidelity Enhanced Income W Monthly Inc-2.318.6925.97394.006.80Buy
Fidelity Moneybuilder Dividend Y Inc-1.2914.5835.55924.574.56Buy
Fidelity Moneybuilder Dividend Y Monthly Inc-1.3014.5435.51924.574.56Buy
Franklin UK Equity Income W Inc7.7630.1657.79513.574.14Buy

Investment Trusts

Name1 Year (%)3 Years (%)5 Years (%)DiscountNAV
Blackrock Income And Growth Investment Trust Plc Ord 1P5.6219.6850.31-4.87216.54Buy
British & American IT PLC Ord-10.77-1.0945.2225.2061.50Buy
Chelverton Small Companies Dividend Trust plc Ordinary Shares6.7470.65143.920.21256.96Buy
Dunedin Income Growth Investment Trust PLC Ord 25p4.1814.1418.00-10.60291.39Buy
Edinburgh Investment Tst plc-3.5212.9340.81-9.12766.96Buy
F&C Capital & Income IT PLC Ord12.4242.2157.750.34340.33Buy
F&C UK High Income Trust plc Ord 0.1P2.4222.2840.62-8.82114.06Buy
F&C UK High Income Trust plc B Ord 0.1P2.6925.6043.89-8.82114.06Buy
F&C UK High Income Trust plc Uts1.4017.9237.42-10.14456.24Buy
Finsbury Growth & Income Trust PLC14.4543.6285.970.83798.36Buy
Invesco Income Growth Trust plc0.308.1833.40-13.06331.28Buy
JP Morgan Elect Managed Income Shs 0.001P10.9427.5050.78-2.24120.70Buy
JP Morgan Claverhouse IT plc18.1438.8772.11-3.86800.90Buy
Lowland Investment Company Ord5.1525.5044.87-7.261,684.90Buy
Merchants Trust PLC14.4327.2441.82-5.46558.50Buy
Murray Income Trust PLC Ord 25p2.3920.0722.58-8.78866.04Buy
Perpetual Income and Growth Investment Trust plc-3.66-1.3426.09-10.98415.08Buy
Schroder Income Growth10.0720.6147.46-7.99330.93Buy
Shires Income plc Ord 50p17.3830.0447.15-1.52284.33Buy
Standard Life Equity Income Trust18.3031.2562.98-1.60505.60Buy

ETFs

Name6 Months (%)1 Year (%)3 Years (%)5 Years (%)CurrencySector
Amundi FTSE 100 UCITS ETF C GBP7.578.5724.5437.98GBPEquity - UKBuy
BMO Enhanced Income UK Equity UCITS ETF4.67---GBPEquity - UKBuy
BMO MSCI UK Income Leaders11.226.78--GBPEquity - UKBuy
ETFS 3x Daily Short FTSE 100-23.18-27.52-66.21-GBXEquity - UKBuy
ETFS 3x Daily Long FTSE 10021.0322.2950.28-GBXEquity - UKBuy
ETFS FTSE 100 Leveraged (Daily 2x) GO UCITS ETF GBP13.8114.4536.1553.58GBPEquity - UKBuy
ETFS FTSE 100 Super Short Strategy (Daily 2x) GO UCITS ETF GBP-15.56-18.51-48.38-63.16GBPEquity - UKBuy
First Trust United Kingdom AlphaDEX UCITS ETF B Inc GBP11.9314.13--GBPEquity - UKBuy
First Trust United Kingdom AlphaDEX UCITS ETF A Acc GBP11.9314.1320.4650.68GBPEquity - UKBuy
HSBC FTSE 1009.4410.5627.0140.40GBPEquity - UKBuy
HSBC FTSE 2507.889.6325.3560.46GBPEquity - UKBuy
Lyxor FTSE 100 UCITS ETF C GBP6.428.8625.6739.67GBPEquity - UKBuy
Lyxor FTSE 100 UCITS ETF Monthly Hedged C USD8.059.56--USDEquity - UKBuy
Lyxor FTSE UK Quality Low Vol Dividend (DR) UCITS ETF D GBP5.21---GBPEquity - UKBuy
Lyxor UCITS ETF FTSE 250 GBP7.419.2125.2660.72GBPEquity - UKBuy
Lyxor UCITS ETF FTSE All Share GBP7.548.8325.2741.97GBPEquity - UKBuy
Ossiam FTSE 100 Minimum Variance 1D GBP1.870.375.24-GBPEquity - UKBuy
Ossiam FTSE 100 Minimum Variance UCITS ETF 1C GBP5.073.5115.2336.35GBPEquity - UKBuy
PS FTSE RAFI UK 100 UCITS ETF GBP9.9512.4129.7638.68GBPEquity - UKBuy
PS FTSE UK High Dividend Low Volatility UCITS ETF GBP5.51-1.96--GBPEquity - UKBuy

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