BlackRock's Whitestone: More pain ahead for UK equity income investors

Income funds and debt issues causing problems

The rise of UK equity income funds will create problems for investors pinning their hopes on companies that are "paying dividends they just cannot afford", according to BlackRock's Dan Whitestone.

UK equity investors are likely to suffer yet another year of high-profile dividend cuts, Whitestone said, while he warned "there are many value traps masquerading as cheap companies" in the UK stockmarket. Whitestone, who runs the £434m BlackRock Throgmorton Trust, took aim at equity income funds, blaming them for "creating a massive problem" by making companies "hostage to paying dividends they just cannot afford". Robin Geffen: Why many UK dividend yields 'are purely an illusion' The manager, who can hold long and short positions, said he speaks to numerous firms that pay dividen...