In previous articles, FE Trustnet has looked at how to build a portfolio that pays out every month, for both the closed-ended – investment trust – universe and UK Equity Income sector.
The number of global and Asian equity income funds is now so high that investors could do the same with these funds, or, more likely, blend them in with funds from the other sectors to create a diversified monthly plan.
January, April, July, October
Unfortunately, the five crown-rated £356m Invesco Perpetual Global Equity Income fund only pays out twice a year, in April and October.
The fund, which currently yields 2.73 per cent, has proved popular with investors and advisers. It is top quartile in the IMA Global Equity Income sector over the last three years.
It saw a change of management last December, with chief investment officer Nick Mustoe taking over. FE Analytics data suggests inflows have slowed slightly since this time, although they are still positive.
However, there is a very similar portfolio run by Mustoe for St James's Place which does pay out four times a year – SJP Global Equity Income. This fund is currently yielding 2.59 per cent.
It was only launched in April of last year, so performance data is scarce, but it is top quartile so far. Mustoe brings with him over 25 years of experience to the table.
Performance of fund versus sector since April 2012
Source: FE Analytics
Aberdeen World Growth & Income offers a higher income, at 3.5 per cent, and has a longer track record, having launched in October 2009.
Swiss drug manufacturer Roche is the largest single holding in all three funds, but does not appear in the top-10 holdings of Fidelity Global Dividend, another fund with these payout dates.
The £34m portfolio only has a one-year record, but has made 22.18 per cent in that time, putting it in the sector’s top quartile.
JPM Global Equity Income, Martin Currie Global Equity Income, Standard Life Global Equity Income and Henderson Global Equity Income also pay out on these dates, while Veritas Global Equity Income pays out in April and October.
February, May, August, November
Five crown-rated Newton Global Higher Income is one of the highest-profile funds to pay out on these dates.
The £3.5bn portfolio is currently yielding 3.94 per cent, according to data from FE Analytics, well above the sector average.
The fund has one of the longest track records in the space, having been launched in November 2005, and is a top-quartile performer over three and five years.
Performance of fund vs sector over 5yrs
Source: FE Analytics
M&G Global Dividend is far and away the largest global equity income fund, its £5.1bn AUM making it more than £1.5bn larger than Newton Global Higher Income, the second-largest.
FE Alpha Manager Stuart Rhodes’ fund is currently yielding 2.92 per cent and has beaten the IMA Global Equity Income sector over one and three years on a total return basis.
It sits in the IMA Global sector to avoid having to commit to a minimum yield.
These are good months for investors looking for Asian exposure: both Newton Asian Income and Schroder Asian Income Maximiser pay out at these times of the year.
Jason Pidcock’s five crown-rated Newton Asian Income fund currently yields 4.02 per cent and is one of the outstanding portfolios in the IMA Asia Pacific ex Japan space over the past five years.
Our data shows it has made 134.35 per cent over this time while the sector has made 60.58 per cent.
Performance of fund vs sector over 5yrs
Source: FE Analytics
Lazard Global Equity Income, Neptune Global Income and Sarasin Global Equity Income all pay out in these months, as does L&G Asian Income.
March, June, September, December
Stephen Thornber’s £250m Threadneedle Global Equity Income fund is one of the standout performers with these payout dates.
The fund is currently yielding 4 per cent. It has made 59.97 and 45.79 per cent over five and three years respectively, compared with 49.33 and 34.16 per cent from the sector.
This makes it a top-quartile performer over both periods.
Performance of fund vs sector over 3yrs
Source: FE Analytics
Funds from Baillie Gifford, Bedlam and BlackRock also pay out in these months, while Schroder Global Equity Income and Artemis Global Income pay out in March and September.
Henderson Asian Dividend Income pays out at these quarterly points. It is currently yielding 5.4 per cent, higher than all the other funds under consideration except Schroder Asian Income Maximiser.
The £102m fund has been run by Michael Kerley since November 2009. It has returned 37.39 per cent over the past three years, putting it in the sector’s top quartile.