AXA Framlington Monthly Income Fund Z GBP Inc
UK Equity Income
Rated Fund 2018-19. Ideal for monthly income seekers
Axa Framlington Monthly Income was added to our Rated Funds last year and was subsequently highly commended in the Best Larger UK Equity Income Fund category of Money Observer’s awards in 2018.
As the fund’s name suggests, it pays a monthly dividend, so it is ideally suited to those looking for a regular income stream from their investments to meet day-to-day living expenses. Among them are those drawing income from their pension pots instead of buying an annuity at retirement, and seeking to invest in funds that produce a sufficient natural yield to keep pace with withdrawals and avoid eating into capital.
Fund manger George Luckraft takes an unconstrained investment approach to deliver a current annual yield of 5% from 94 stocks.
He pioneered the ‘barbell’ strategy, which combines traditional high-yielding equities with lower-yielding growth stocks. The portfolio is built around large international firms paying a high yield: Royal Dutch Shell, BP, HSBC and GlaxoSmithKline are its largest holdings. Luckraft focuses on the sector in expectation that in a tough economic environment the strong will get stronger.
He balances these with fast-growing smaller companies. Unusually for an equity income fund, a quarter of the fund is in Alternative Investment Market shares. These often have little or no yield, so the fund can still be successful when traditional income-paying stocks are unloved.
Luckraft holds stocks for the long term – turnover runs at less than 5% a year – and has a successful long-term record. But his bias to often illiquid small and medium-sized firms can make his performance more volatile than his peers.
Narrative and ratings content all as of 01 January 2019.See all Money Observer rated funds
|Royal Dutch Shell PLC B||5.99 %|
|BP PLC||5.00 %|
|HSBC Holdings PLC||3.87 %|
|GlaxoSmithKline PLC||3.71 %|
|iEnergizer Ltd||2.59 %|
|Anexo Group PLC||2.40 %|
|British American Tobacco PLC||2.38 %|
|Tarsus Group PLC||2.38 %|
|Intermediate Capital Group PLC||2.24 %|
|Craneware PLC||2.18 %|
|United Kingdom||93.00 %|
|Financial Services||23.06 %|
|Consumer Cyclical||13.40 %|
|Basic materials||8.32 %|
|Consumer Defensive||6.58 %|
|Real Estate||5.55 %|
George joined Framlington in 2002 and is the lead fund manager for the AXA Framlington Equity Income, AXA Framlington Managed Income and AXA Framlington Monthly Income Funds. Previously he worked for Carrington Pembroke (subsequently ABN AMRO and now Artemis Unit Trust Managers) where he was Head of UK Equities. George graduated from Cambridge with a degree in Engineering and Land Economy in 1980.
Data provided by Morningstar.
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