SLI's Robertson backs low yielders for fastest growth

Standard Life Investments' UK income manager Karen Robertson has been boosting exposure to lower yielding sectors of the market, in the expectation they will provide faster rates of dividend growth.

Robertson, running the group’s £686m UK Equity Higher Income fund, has built up a 12% overweight position in industrial engineers and travel and leisure companies. The manager said both sectors have a plethora of companies which will deliver faster dividend growth in the next twelve months than their high yielding counterparts. Robertson added a number of defensive companies’ dividend prospects have now flatlined, while valuations are sky high. “Defensive companies are trading on twice the valuation multiple compared to cyclical-natured stocks, and there is no reason why their earn...