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 Acc13.3424.7167.5996.553.97Buy
AXA Framlington Monthly Income Z Acc19.2829.0788.14257.574.26Buy
Aberdeen UK Equity Income I Acc13.5818.1952.47180.653.40Buy
Artemis Income I Acc16.2530.8373.786,471.293.75Buy
Aviva Inv UK Equity Income 2 Acc16.0132.0877.83981.423.60Buy
Barclays UK Equity Income R Acc GBP16.3626.4174.07164.703.90Buy
Barclays UK Equity Income S2 R Acc GBP16.2126.1974.10187.604.30Buy
BlackRock UK Income D Acc15.7836.1169.85411.883.90Buy
CF Canlife UK Equity Income C Acc GBP11.5030.2164.29191.753.42Buy
CF Miton UK Multi Cap Income B Inst Acc20.6438.98130.25901.563.97Buy
CF Woodford Equity Income C Acc GBP10.9139.20-10,048.362.91Buy
F&C Responsible UK Income 2 Acc15.1232.0677.93323.423.10Buy
F&C UK Equity Income 2 Acc13.3728.7457.9762.313.10Buy
FP Miton Income B Acc11.8933.9669.57193.933.92Buy
Fidelity Enhanced Income Y Acc7.8419.4151.58553.006.25Buy
Fidelity Enhanced Income W Acc8.0219.9848.61553.006.20Buy
Franklin UK Equity Income W Acc13.1536.3682.97399.704.01Buy
HC Charteris Premium Income Inst Acc15.6520.4831.9111.601.39Buy
HL Multi Manager Income & Growth A Acc15.4828.9876.413,174.763.91Buy
HSBC Income C Acc12.0021.1952.79203.393.53Buy

OEICs and Unit Trusts

Name1 Year (%)3 Years (%)5 Years (%)Fund Size (M)Yield (%)
AXA Framlington Blue Chip Equity Income Z Inc13.2824.6959.4996.554.10Buy
AXA Framlington Monthly Income Z Inc19.2829.1188.21257.574.36Buy
Aberdeen UK Equity Income I Inc13.5718.2452.48180.653.40Buy
Allianz UK Equity Income C Inc18.2118.3563.4869.024.10Buy
Artemis Income I Inc16.2630.8573.826,471.293.86Buy
Aviva Inv UK Equity Income 216.0032.0777.80981.423.70Buy
Barclays UK Equity Income R Dis GBP16.3726.4174.21164.704.10Buy
Barclays UK Equity Income S2 R Dis GBP16.1925.9873.72187.604.30Buy
BlackRock UK Income D Inc15.8236.2269.94411.883.92Buy
CF Canlife UK Equity Income C Inc GBP11.4931.0065.15191.753.51Buy
CF Miton UK Multi Cap Income B Inst Inc20.6039.02130.02901.564.07Buy
CF Woodford Equity Income C Inc GBP10.8939.18-10,048.363.00Buy
Castlefield B.E.S.T Income Inst Inc10.2419.2453.7127.033.85Buy
Castlefield B.E.S.T Income Charity Inc10.2419.2453.8727.033.85Buy
F&C Responsible UK Income 2 Inc15.1132.0777.81323.423.80Buy
F&C UK Equity Income 2 Inc13.1527.6054.4762.313.70Buy
FP Miton Income B Inc11.8933.9969.67193.934.07Buy
Fidelity Enhanced Income W Inc8.0620.0848.48553.006.68Buy
Fidelity Enhanced Income Y Inc7.9119.4147.22553.006.73Buy
Fidelity Enhanced Income W Monthly Inc7.9419.9048.51553.006.70Buy

Investment Trusts

Name1 Year (%)3 Years (%)5 Years (%)DiscountNAV
Blackrock Income And Growth Investment Trust Plc Ord 1P13.3230.0572.60-5.33206.50Buy
British & American IT PLC Ord22.1237.76125.9147.7464.30Buy
Chelverton Small Companies Dividend Trust plc Ordinary Shares39.0654.00236.951.75241.27Buy
Chelverton Small Companies Dividend Trust plc Zero Dividend Preference Shares3.6113.54---Buy
Dunedin Income Growth Investment Trust PLC Ord 25p15.7013.3949.44-9.40294.16Buy
Edinburgh Investment Tst plc12.6536.7676.73-4.31786.89Buy
F&C Capital & Income IT PLC Ord24.1838.6778.150.07316.78Buy
Finsbury Growth & Income Trust PLC15.4254.03128.340.74720.69Buy
Invesco Income Growth Trust plc12.2123.0970.20-9.02332.21Buy
JP Morgan Elect Managed Income16.4826.4173.579.62102.40Buy
JP Morgan Income & Capital Trust plc Ord36.6922.92123.84-8.87101.50Buy
JP Morgan Income & Capital Trust plc Package Units24.0515.2981.16-4.54387.60Buy
JP Morgan Income & Capital Trust plc ZDP4.0210.4643.131.57184.60Buy
JP Morgan Claverhouse IT plc22.8929.2099.16-9.04738.80Buy
Lowland Investment Company Ord25.1217.6292.68-6.981,604.00Buy
Merchants Trust PLC20.3511.6268.54-5.57501.67Buy
Miton The Investment Company Ord-2.61-4.1380.40-9.66368.06Buy
Murray Income Trust PLC Ord 25p18.6415.6651.61-8.05871.67Buy
Perpetual Income and Growth Investment Trust plc8.3416.3773.88-7.86428.71Buy
Schroder Income Growth22.0121.3684.78-8.02314.48Buy

ETFs

Name6 Months (%)1 Year (%)3 Years (%)5 Years (%)CurrencySector
Amundi FTSE 100 UCITS ETF C GBP5.3514.4522.2356.15GBPEquity - UKBuy
BMO MSCI UK Income Leaders12.1812.62--GBPEquity - UKBuy
DB X-Trackers FTSE 100 UCITS ETF (DR) - Income 1D GBP5.4214.5522.3756.23GBPEquity - UKBuy
DB X-Trackers FTSE 250 UCITS ETF (DR) 1D GBP9.9118.4735.2397.35GBPEquity - UKBuy
DB X-Trackers FTSE All Share UCITS ETF (DR) 1D GBP6.2215.4524.5262.33GBPEquity - UKBuy
DB X-Trackers FTSE 100 Equal Weight UCITS ETF (DR) 1D GBP7.4614.90--GBPEquity - UKBuy
DB X-Trackers FTSE 100 Short Daily UCITS ETF GBP-5.99-14.53-25.60-43.53GBPEquity - UKBuy
DB X-Trackers FTSE 100 UCITS ETF (DR) 1C GBP5.4814.7423.06-GBPEquity - UKBuy
ETFS 3x Daily Short FTSE 100-17.16-38.27-65.28-GBXEquity - UKBuy
ETFS 3x Daily Long FTSE 10014.6742.8339.19-GBXEquity - UKBuy
ETFS FTSE 100 Leveraged (Daily 2x) GO UCITS ETF GBP9.4826.9229.6794.20GBPEquity - UKBuy
ETFS FTSE 100 Super Short Strategy (Daily 2x) GO UCITS ETF GBP-11.50-26.84-47.45-72.19GBPEquity - UKBuy
First Trust United Kingdom AlphaDEX UCITS ETF B Inc GBP7.4712.57--GBPEquity - UKBuy
First Trust United Kingdom AlphaDEX UCITS ETF A Acc GBP7.4713.3526.30-GBPEquity - UKBuy
HSBC FTSE 1005.4614.6422.4156.01GBPEquity - UKBuy
HSBC FTSE 2509.8718.3535.2796.91GBPEquity - UKBuy
Lyxor UCITS ETF FTSE 250 GBP9.9418.5035.8798.46GBPEquity - UKBuy
Lyxor UCITS ETF FTSE 100 Monthly Hedged C USD5.71---USDEquity - UKBuy
Lyxor UCITS ETF FTSE 100 C GBP5.5014.8023.2757.77GBPEquity - UKBuy
Lyxor UCITS ETF FTSE All Share GBP6.2415.4824.8062.73GBPEquity - UKBuy

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