View more on these topics

Income fund chiefs face dividend conundrum

Schroders income maximiser fund manager Thomas See bel-ieves that many other income fund managers will face a conundrum when it comes to offering dividends.

See says that although analysts are anticipating yield levels sticking around the 5 per cent mark for the next year or two, the dividend swap market – where you buy and sell future dividends for cash – is at half that level, indicating that the overall yields could be far less.

He says: “There are a number of problems facing income managers, namely that six stocks in the shape of HSBC, Shell, BP, Vodafone, GlaxoSmithKline and AstraZeneca account for 50 per cent of dividends in the market while 19 stocks account for 70 per cent of the market.”

See became lead manager on the income maximiser last month, replacing John Teahan. The maximiser targets 7 per cent income a year through dividends and premiums from selling covered call options.

See also echoed the views of other income managers, such as PSigma’s Bill Mott, by saying that there may also be difficulties for fund managers seeking to diversify as, if they end up all picking the same stocks, this is likely to push up the price.



Sayonara final salary schemes

Have the decisions taken by Barclays and BP this week, to throw in the towel on final salary pensions, marked the beginning of the end of top-quality private sector schemes?

Lords seek clearer delegation of powers to supervise banks

The House of Lords economic affairs committee has called for macro-prudential supervision to be given to the Bank of England’s financial stability committee rather than left with the FSA.In its Regulation and Banking Supervision report, published this week, the Lords committee says the BoE financial stability committee should have “direct access to the information req-uired […]


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm