Kilo model portfolio - balanced income, higher risk
Who is it for:
- Investors looking for a good income from their capital, with the potential for some growth in their income and capital.
- However, investors must be able to afford for their income to fall and to lose some of their capital under a worst case scenario.
- May be suitable for retired investors with other secure sources of income who are prepared to take additional risks with their spare capital in order to boost their income and growth prospects.
- May also appeal to younger investors who can opt to reinvest their dividends as part of a long-term growth strategy.
What it looks like:
| Fund | Role in portfolio | |
|---|---|---|
| Artemis Global Income | Invests in strong companies globally for income, has low UK content. | View Factsheet |
| Ballie Gifford Corporate Bond | Invests in different types of corporate bonds to generate a high monthly income. | View Factsheet |
| Lowland | Invests in UK companies of all sizes to achieve increasing income and capital growth. | View Factsheet |
| JPMorgan European IT | Adds some regional diversity to the portfolio. | View Factsheet |
| MI Chelverton UK Equity Income | Invests in higher yielding small and medium sized UK companies. | View Factsheet |
| Schroder Income | Strong track record of seeking out unloved stocks. | View Factsheet |
Why were these funds selected:
In order to provide investors with a regular basic monthly income as well as some capital security, this portfolio holds the Baillie Gifford Corporate Bond fund. It also has a core UK equity holding to complement Schroder Income's focus on recovery stocks. This fund's focus is on capital preservation while aiming to achieve a growing income and capital growth.
Two further UK equity holdings in the portfolio are Lowland and PFS Chelverton UK Equity Income which provide more exposure to medium and smaller sized companies and should give the portfolio greater income and capital growth potential. Diversified international exposure comes from the portfolio’s holdings in Artemis Global Income and regional diversity comes from the income shares of JPMorgan European IT.
Where to get it:
Follow this portfolio
Rated Funds and the Model Portfolios are at the heart of everything we do here at Money Observer, and subscribing to our newsletters or the monthly magazine will keep you informed of any changes and updates we make and why.
Timeline:
2018
Sell Newton Global Income
Lost patience with this underperformer.
Buy JPMorgan European IT
Adding some regional diversity.
2018
Sell Rathbone Income
Weakest performer in the portfolio.
Buy Schroder Income
Value approach targets unloved companies.
2017
Sell Troy Income & Growth
Has underperformed its peers and is in the bottom quartile of its sector over 12 months.
2016
Sell Temple Bar
Contrarian approach has produced disappointing capital performance.
Buy Lowland
Invests in UK companies of all sizes, emphasises capital growth as well as increasing income.
2015
Sell M&G Optimal Income
Falling yield has made fund less attractive for income seekers.
Buy Baillie Gifford Corporate Bond
High yielding, strategic, go-anywhere fund with greater scope to adjust to changing circumstances.
Sell Unicorn UK Income
Change of manager.
Buy PFS Chelverton UK Equity Income
Run by tried and tested managers, invests in small and mid sized companies.
2014
Sell JOHambro UK Equity Income
Soft closed
Buy Troy Income & Growth
Defensive UK equity trust, with emphasis on capital preservation and paying an attractive yield.
Sell CF Miton UK Multi Cap Income
Buy Rathbone Income
Dependable multi cap UK equity income fund.
Sell Schroder Global Equity Income
Change of manager
Buy Artemis Global Income
Good international diversification with low exposure to the UK.
2013
Sell Kames High Yield
Disappointing performance.
Buy CF Miton UK Multi Cap Income
Attractive yield with bias towards small and medium sized companies.
Sell Murray International
Premium to net asset value too high making it unattractive to new investors.
Buy Schroder Global Equity Income
Invests internationally in solid companies with stable business models.
2012
Buy JOHambro UK Equity Income
Strongly performing UK equity income fund with experienced managers.
Buy Kames High Yield
Provides high income from high yielding global bonds.
Buy M&G Optimal Income
Strategic, go-anywhere bond fund.
Buy Murray International
Provides global diversification with significant exposure to Asian and emerging market equities.
Buy Newton Global Income
Provides international diversification and benefits from solid past performance record.
Buy Temple Bar
Invests mainly in large blue chip companies and has long record of growing its income.
Buy Unicorn UK Income
Specialises in higher yielding smaller companies.
Last updated:
17 Jan 2018
