Schroders has postponed the launch of its European equity income trust following a lack of initial demand.
The trust was test marketed to specific buyers and is expec-ted to be launched by the end of the year to allow more time to attract interest.
It is structured in a similar vein to the group’s income maximiser fund, targeting a yield of around 4.5 per cent and using covered call options against half the value of its holdings. It is expected to be managed by Sonja Schemmann.
Managing director Robin Stoakley says the group, which is looking to raise an initial 75m, is still confident that the trust will start this year.
He says: “We still harbour ambitions to launch the vehicle around December but we will weigh up a number of options at our next meeting in a few weeks.”
BestInvest head of communications Justin Modray says: “With investment trusts, if you fail to reach your target at launch it can cause problems so it makes sense for Schroders to be cautious.”