Britannic Asset Management is capitalising on the recent investment trust revival with the introduction of the Britannic global income trust.
The trust aims to deliver growth and a high level of income by investing in global equities and split capital ordinary shares.
There are two share classes. The geared ordinary shares have a target yield of 8.75 per cent a year and the zero dividend preference shares are expected to return 9 per cent in 2005.
Diversity is ensured by the growth portfolio's global focus, which means risks are spread geographically. However, as the investment relies on a certain degree of underlying growth, there will always be an element of risk, particularly in respect of the gearing.
The trust would be suitable for more sophisticated investors. Other potential investors may find the structure confusing and may not feel confident investing in a split capital investment trust like this.
According to Standard & Poor's the Britannic smaller companies investment trust is ranked 20 out of 28 trusts based on £1,000 invested on a mid-to-mid basis with net income reinvested over three years to November 13, 2000.