Multi-managerMay 31 2013

Henderson ditches yield target for multi-manager funds

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Henderson is ditching the yield target on two of its multi-manager funds after being hit by issues caused by the low-yielding bonds environment.

The company said it will no longer include in its investment objective that it looks to provide an income in excess of the yield of the FTSE All-Share Index on either its £431.5 Multi-Manager Income & Growth fund or its £214.2m Multi-Manager Distribution fund.

“Since the financial crisis in 2008...there has been a dramatic change in the relative income produced by the different asset classes so that equities now yield, on average, more than gilts and cash and almost as much as investment grade corporate bonds. This has caused some issues for the Fund,” Henderson said in investor letters available on its website.

“...we have sought to balance income and capital growth/protection, rather than simply chase a yield”, the group said, adding that both funds had recently hit the 60 per cent limit on their equity exposure.