Premier Optimum Income Fund Class C Income Shares

UK Equity Income

New for 2018. Uses derivatives to boost target income to 7 per cent

The highest yielder among our selection, Premier Optimum Income targets a yield of 7 per cent and is currently within touching distance of that at 6.7 per cent. It achieves this through a derivatives-based yield-boosting strategy similar to that employed by Schroder Income Maximiser, a Rated Fund from 2013 to 2017. We have replaced it this year with Premier Optimum Income on account of the latter's more nimble size (�100 million versus �1.1 billion) and better performance. It has a relatively new team in the form of Chris White and Geoff Kirk, who became co-managers in October 2017. White has worked at Premier Asset Management for seven years and runs its other income funds, while Kirk joined Premier in July 2017 from Schroders, where he worked for 11 years.

White selects 40 to 60 mainly UK high-yielding shares that he believes have good, long-term income and growth potential. He aims to find shares that are undervalued and trading at a price below their true value. To enhance the dividends from these shares, Kirk uses a covered call overwriting strategy. This involves selling short-term call options over selected shares held in the portfolio, providing an upfront cash payment that is added to the dividends already generated. In exchange for this, the rise in the price of the selected shares is capped over a defined period of time. This means that the fund may not benefit from the full rise in the price of the selected shares. Income is paid quarterly.

Narrative and ratings content all as of 01 January 2018.

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Premier Optimum Income Fund Class C Income Shares
Premier Portfolio Managers Limited
Open Ended Investment Company
UK Equity Income
1.01 %
Risk Rating
3 Year Sharpe
3 Year Alpha
8.6 %
IA UK Equity Income Sector
The fund seeks to provide a high level of income together with the prospect of long term capital growth from an actively managed portfolio of equities. The fund will invest the majority of its assets in a portfolio of equities listed on UK stock exchanges and will have the ability to enhance income by selling options. The fund may also invest in global equities, preference shares, fixed interest securities, money market instruments, deposits, structured notes, warrants and other high yielding assets and may also include approved derivatives. Subject to the above, the fund may also invest in other transferable securities, collective investment schemes, and cash and near cash and bonds in accordance with the rules in COLL.
Holding %
Royal Dutch Shell PLC B 8.36 %
GlaxoSmithKline PLC 6.55 %
Diversified Gas & Oil PLC 4.67 %
Imperial Brands PLC 4.48 %
BT Group PLC 4.18 %
Legal & General Group PLC 4.18 %
BP PLC 3.71 %
HSBC Holdings PLC 2.97 %
Daily Mail and General Trust PLC Class A 2.81 %
Aviva PLC 2.74 %
Region %
United Kingdom 93.94 %
Sector %
Financial Services 21.65 %
Consumer Cyclical 20.36 %
Energy 17.31 %
Industrials 10.32 %
Consumer Defensive 7.77 %
Healthcare 6.77 %
Premier Portfolio Managers Limited
GU1 3DE, Guildford, United Kingdom
Legal Structure
Open Ended Investment Company


Geoff Kirk
Joined 10/01/2017

Geoff Kirk joined Premier Asset Management in July 2017 to become co-manager. Geoff joined from Schroders where he had worked for 11 years managing covered call option strategies for income enhancement. Previously Geoff was a senior portfolio analyst at State Street Global Advisers. He is a CFA Charterholder.

Chris White
Joined 10/01/2017

Chris White, joined Premier Asset Management in November 2010 to manage UK income funds.Chris also heads up Premier’s UK equity team. Previously, he was with Threadneedle for 7 years as a Director of UK Income Funds. Chris started his career with Robson Rhodes and has also worked for Charterhouse Tilney and Legg Mason as an investment manager. He holds an honours degree in Economics and is a member of the Chartered Institute for Securities & Investment and the CFA.

Data provided by Morningstar.

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