Geffen: Worst-hit income funds in Q1 sell-off took highest dividend risk

IA UK Equity Income sector average down 3.9%

Beth Brearley
clock • 3 min read

There was a direct correlation between the worst-performing UK equity income funds during the recent sell-off and those with the highest dividend concentration risk, claims Neptune CEO Robin Geffen.

According to Geffen, who used Morningstar data, the average bottom quartile fund in the IA UK Equity Income sector during the Q1 market sell-off relies on its top ten holdings for 51.47% of its yield generation. During the correction between 29 January and 5 February, the IA UK Equity Income sector average was down 3.9% while the FTSE 100 dropped 4.4% and the FTSE All-Share fell 4.3%. "Importantly, and somewhat uncomfortably for many income investors, traditional FTSE 100 income stocks were some of the hardest hit during the sell-off," Geffen said.  'It wasn't the outcome we hoped ...

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

Join now

 

Already an Investment Week
member?

Login

More on Equities

Event Voice: Artemis' Cormac Weldon on the US

Event Voice: Artemis' Cormac Weldon on the US

Cormac Weldon looks into US markets.

Cormac Weldon, Head of US equities, Artemis Fund Managers
clock 18 November 2024 • 5 min read
Autumn Budget 24: Chancellor Reeves sets 20% IHT rate on AIM shares

Autumn Budget 24: Chancellor Reeves sets 20% IHT rate on AIM shares

Inheritance tax reform

Cristian Angeloni
clock 30 October 2024 • 1 min read
Partner Insight: Why investors shouldn't try to second-guess election results

Partner Insight: Why investors shouldn't try to second-guess election results

Investment Week
clock 28 October 2024 • 1 min read
Trustpilot