Barings' Lucas rotates out of consumer stock 'mistakes' to limit drawdown

New companies added as consumer goods giants dumped

Head of equity income at Barings, Darryl Lucas, has selected two "predictable, robust" stocks within the firm's Global Dividend Champions fund in recent months, following three portfolio "mistakes", in attempts to limit the vehicle’s potential drawdown should market conditions worsen.

Kimberly-Clark, Procter & Gamble, and Henkel posted declines of about 4%, 5% and 12% respectively over the periods they were owned by the fund, according to Lucas, who has more recently added Walmart de Mexico and Coloplast to the three-year-old vehicle. Lucas said the "common theme" among the two "failed investments" within the consumer goods sector - Kimberly-Clark and Procter & Gamble, which were sold in March 2018 - is a "fragmenting" landscape "where the brand is no longer the obvious shortcut to a quality product that it used to be". Global dividend payments almost double over d...