Benefits of a diversified UK income portfolio

Lazard's Alan Clifford says UK investors need to be more creative than ever to achieve both capital appreciation and yield premiums

According to a recent report from Capita Registrars, in 2009 the top five dividend payers in the UK accounted for 47% of all UK dividends, up from 35% in 2008. There was a 15% cut in UK dividends overall – equivalent to £10bn in aggregate. Finding attractively priced yield opportunities and building a diversified portfolio in such a concentrated environment is challenging for income investors. With this in mind, it is imperative investors become more creative if they are to achieve both capital appreciation and yield premium. Specifically, we look at a few often-overlooked areas of oppor...