Premier Asset Management has hired Geoff Kirk from Schroders to co-manage the £84m Premier Optimum Income fund alongside Chris White, as the firm looks to further enhance the income strategy.
Mr Kirk is an experienced structured investment specialist, having worked on the Schroder Income Maximiser range of funds, including experience in over the counter single stock option trading, execution and counterparty management, and adding derivative yield to enhanced income.
He is expected to join Premier in July 2017 and the duo will take over from Chris Wright, who has managed the fund since 2013.
Mr White will focus on the management of the UK equity portfolio of the Optimum Income fund, while Mr Kirk will focus on “total dividend management through a call option overlay strategy”.
The fund already adopts an enhanced income strategy and the factsheet notes: "The fund is also expected to use derivative instruments to generate extra income in return for giving away some potential for capital gains. The fund utilises derivatives by writing call options that give away the right to some of the capital appreciation of a stock (company share) to provide investors in the fund with extra income."
Following the change Mr White will continue in his role as manager of the Premier Monthly Income and Income funds, while Mr Wright will remain in charge of the Premier Ethical fund, which he has managed since 2009, and will continue as manager of the Optimum Income fund until the handover to Mr Kirk and Mr White.
Mike O’Shea, chief executive of Premier Asset Management, says: “The search for yield is an enduring investor theme and we believe the Premier Optimum Income fund, paying an enhanced yield to investors through a mix of traditional company dividends and a well-managed options strategy, is well placed to help income-seeking investors.
“We are excited about the next phase for this fund under the co-management of Chris White and Geoff, with their strong track record of managing UK equity income funds and as an experienced structured fund management specialist.”
Mr Kirk added: “This enhanced income strategy offers investors the potential for a long term, sustainable higher income compared to other income investments. I look forward to being part of the fund management team, working closely with Chris White, focusing on delivering good enhanced income outcomes for our clients and growing assets in this strategy.”
The demand for increased income has led to a number of fund houses looking to enhance their income offerings, with income overlay strategies using call options already used by Schroders, Fidelity and RWC, with Schroders adding to their Maximiser range in January with a US strategy to add to its Asian, UK, Global and European offerings.