The managers of the top-performing Unicorn UK Income fund are selling down small- and mid-cap companies in favour of larger firms in a move away from its traditional hunting ground.
Co-manager Simon Moon, who was appointed to John McClure’s fund in January alongside Fraser Mackersie, said small and mid-cap firms have enjoyed a “healthy” rally over the past 12 months, but yields have fallen sharply. “You have seen some real yield compression, so we have sold some of those companies,” he said. “We believe they are very good companies, but the share price has doubled and they have only put their dividend up by 15%.” By contrast, he said payouts are picking up for large-cap firms: “You have got sectors that will begin to increase their dividend payments. I would say ...
To continue reading this article...
Join Investment Week for free
- Unlimited access to real-time news, analysis and opinion from the investment industry, including the Sustainable Hub covering fund news from the ESG space
- Get ahead of regulatory and technological changes affecting fund management
- Important and breaking news stories selected by the editors delivered straight to your inbox each day
- Weekly members-only newsletter with exclusive opinion pieces from leading industry experts
- Be the first to hear about our extensive events schedule and awards programmes