The Miton global diversified income fund aims for sustainable income, initially around 4 per cent a year, plus capital growth. It will invest globally in bonds, equities, property and other assets using open-ended and closed-ended investment funds.
The fund will contain 30 to 40 funds and will not be managed or constructed against a specific index or benchmark. The fund can also use derivatives to hedge risk in the portfolio when appropriate.
The fund is managed by James Sullivan and Martin Gray. Sullivan is lead manager of the Miton Arcturus fund and supports Gray on the Miton special situations and strategic portfolios. He was part of the team which founded iimia, the company which merged with Miton in 2007 and Midas Capital the following year. The new firm subsequently became MAM Funds in 2010.
Gray began his investment career in 1979 and joined Miton in 1994. He has managed the Miton Strategic Portfolio since launch in 1996 and the Special Situations Portfolio since launch in 1997. He became a manager on the Arcturus fund in 2008.
MAM Funds highlights the ability of various asset classes to produce an income. For equities, it says investing in strong companies can offer sustainable growth, with the potential for a rising income that can counter the impact of inflation. Corporate bonds are also seen as providing attractive levels of income as they tend to pay a higher return than government bonds due to the perceived higher risk of corporate issuers relative to governments. A blend of these assets classes using a fund of funds approach should provide diversification to reduce portfolio risk.
This fund could be popular with investors who need a higher level of income than savings accounts and government bonds can provide. However, established onshore multi-asset income funds of funds from Jupiter, Fidelity and Premier could provide competition.