Hargreaves Lansdown has launched the a new high income fund promising a near 5 per cent yield in a market where its chief investment officer admits traditional income sources have “evaporated”.
The chief investment officer and fund manager admitted generating an attractive income from savings and investments in the current ultra-low interest rate environment poses a significant challenge.
“Many traditional sources of income have evaporated, with instant access deposit accounts offering virtually no income and government bond yields at historically low levels,” he said.
He was speaking as the Bristol-based company revealed the portfolio for its new fund, the Multi-Manager High Income fund, which launches on 13 April.
“We are aiming to blend together some serious investment talent, UK managers who offer different strengths and investment strategies which complement each other, in one income portfolio,” he said of the launch.
The fund will have approximately 60 per cent invested in shares and 40 per cent in corporate bonds (see portfolio breakdown below).
Among the equity funds it will hold are Artemis Global Equity Income, Threadneedle UK Equity Alpha Income, Jupiter Asian Income and Liontrust Macro Equity Income.
The bond funds will include Royal London Sterling Extra Yield Bond, Jupiter Strategic Bond and Kames High Yield Bond
It will also hold two mixed asset funds: Eden Tree Higher Income and Artemis High Income.
The fund aims to achieve a yield of 4.5 per cent.
It will sit in the Investment Association Flexible Investment sector, with an ongoing charge of 1.33 per cent.
HL Multi-Manager High Income fund, initial portfolio:
Equity income
• Marlborough Multi-Cap Income
• Artemis Global Equity Income
• Threadneedle UK Equity Alpha Income
• JOHCM UK Equity Income
• Jupiter Asian Income
• Newton Global Income
• Liontrust Macro Equity Income
Bonds
• Royal London Sterling Extra Yield Bond
• Jupiter Strategic Bond
• Kames High Yield Bond
• Fidelity Extra Income
• Royal London Corporate Bond
Mixed asset
• Eden Tree Higher Income
• Artemis High Income
