Lima model portfolio - growing income, higher risk
- Adventurous investors looking for a growing income from their capital over the long term, plus capital growth.
- 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 newly retired investors with other secure sources of income who are prepared to take additional risks for the prospect of a rising income and capital gains over the long term.
- May also appeal to younger investors who can opt to reinvest their dividends as part of a long-term growth strategy.
|Fund||Role in portfolio|
|Artemis Global Income||Invests in strong companies globally for income, has low UK content.||View Factsheet|
|Utilico Emerging Markets||Invests predominantly in listed companies involved in infrastructure, transport and similar sectors operating in emerging markets.||View Factsheet|
|Lowland||Invests in UK companies of all sizes to achieve increasing income and capital growth.||View Factsheet|
|PFS Chelverton UK Equity Income||Invests in higher yielding small and medium sized UK companies.||View Factsheet|
|Schroder Oriental Income||Focuses on quality companies in Asia Pacific Region.||View Factsheet|
|Scottish Mortgage||A high conviction global growth trust.||View Factsheet|
|Troy Income & Growth||Focuses on capital preservation as well as producing an attractive income.||View Factsheet|
This portfolio invests purely in equity funds in order to provide the best prospects for income growth and capital gains over the long term. It includes four UK focused funds. The core holding is Troy Income and Growth which focuses on capital preservation as well as 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 Scottish Mortgage. They are invested in different ways. The Artemis fund is a classic global equity income fund while Scottish Mortgage is more growth oriented and can be used as a source of capital withdrawals to supplement income. Utilico Emerging Markets gives the portfolio exposure to emerging markets. This trust invests for total return but has a yield of over 3 per cent and pays a quarterly income. Finally, the portfolio includes Schroder Oriental Income which provides exposure to the Asia Pacific region and has good potential to provide an increasing income and capital gains over the long term from this faster growing economic area.
* Charts show bid-to-bid performance with income reinvested.
Please note that past performance is not a guide to future performance. Fund performance data does not take into account fees and expenses which are specific to individual plans.
Please be aware of the risks involved. Money Observer does not provide investment advice. You should choose investments to suit your personal circumstances and attitude to risk. If you are at all unsure you should seek advice.
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Sell Invesco Perpetual Income
Buy Utilico Emerging Markets
Invests for total return but has a yield of over 3 per cent and pays a quarterly income.
Sell Temple Bar
Contrarian approach has produced disappointing capital performance.
Invests in UK companies of all sizes, emphasises capital growth as well as increasing income.
Sell Unicorn UK Income
Change of manager.
Buy PFS Chelverton UK Equity Income
Run by tried and tested managers, also invests in small and mid sized companies.
Sell Newton Asian Income
Change of manager
Buy Schroder Oriental Income
Run by experienced manager, has good potential to provide growing income and capital gain when region recovers.
Sell Schroder Global Equity Income
Change of manager
Buy Artemis Global Income
Good international diversification with low exposure to the UK.
Sell JOHambro UK Equity Income
Buy Troy Income & Growth
Defensive UK equity trust, with emphasis on capital preservation and paying an attractive yield.
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.
Buy Invesco Perpetual Income
Solid UK equity income performer
Buy JOHambro UK Equity Income
Strongly performing UK equity income fund with experienced managers.
Buy Murray International
Provides global diversification with significant exposure to Asian and emerging market equities.
Buy Newton Asian Income
Gives exposure to fast growing economies and companies in the Asia Pacific region.
Buy Scottish Mortgage
A high conviction global trust to provide growth and diversity.
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.