Rathbone Income Fund Institutional Inc

UK Equity Income

Rated Fund 2014-19. A solid choice for rising income.

Rathbone Income is a fund income investors are quite likely to be able to put in their portfolio and then forget about. That is because it has the best record among open-ended equity funds for paying rising dividends. Last year it achieved its 24th increase over the past 25 years.

Its current yield is 4.3% and it pays income half-yearly. The fund can invest in dividend-paying companies of any size and has a concentrated portfolio of 30-50 holdings (45 at present). Carl Stick, its manager since 2000, believes adding further holdings to try to spread risk is only distracting.

He was joined by Alan Dobbie as co-manager in October 2018. They have worked together on UK equity income mandates for more than 13 years.

The managers’ investment style is a mixture of both value and growth – growth because they want the dividend stream to grow year on year, and value because they want to buy shares that offer the greatest value and provide a high earnings yield. Capital preservation is just as important as income growth to them.

They look for the best companies they can find and rely on simple ideas such as earnings and dividend growth, recognition of quality businesses, management teams and products, and on paying the right price for such businesses.

Although two-thirds of the portfolio is in the FTSE 100 index, almost one-fifth is in small and medium-sized companies and a further 10% is in overseas names, for diversification.

The managers believe they often gain an edge from taking a longer-term perspective on business prospects, looking beyond short-term headwinds to a time when underlying characteristics will be re-asserted.

Narrative and ratings content all as of 01 January 2019.

See all Money Observer rated funds
Name
Rathbone Income Fund Institutional Inc
Manager
Rathbone Unit Trust Management Limited
Type
Unit Trust
ISIN
GB00B7FQLQ43
Sector
UK Equity Income
Launched
01/03/2012
OCF
0.79 %
Risk Rating
2
3 Year Sharpe
0.58
3 Year Alpha
-2.04
Yield
4.2 %
Benchmark
FTSE AllSh TR GBP
The objective of the fund is to achieve above average and maintainable income but without neglecting capital security and growth. The Manager intends to achieve the objective primarily through the purchase of ordinary shares with an above average yield. There is no restriction on the economic sectors or geographic areas in which the fund may invest. However, investments will always be predominantly in the ordinary shares of UK companies.
Holding %
GlaxoSmithKline PLC 4.51 %
Unilever PLC 4.32 %
BP PLC 4.13 %
Reckitt Benckiser Group PLC 4.11 %
Royal Dutch Shell PLC B 4.07 %
RELX PLC 3.59 %
Bunzl PLC 3.47 %
Legal & General Group PLC 3.42 %
AstraZeneca PLC 3.35 %
WEC Energy Group Inc 2.97 %
Region %
United Kingdom 88.39 %
United States 6.38 %
Sector %
Consumer Cyclical 21.05 %
Consumer Defensive 19.19 %
Financial Services 15.71 %
Healthcare 12.71 %
Energy 11.57 %
Utilities 9.01 %
Industrials 5.21 %
Name
Rathbone Unit Trust Management Limited
Address
W1J 5FB, London, United Kingdom
UCITS
Yes
Legal Structure
Unit Trust

Managers

Alan Dobbie
Joined 10/05/2018

Mr. Dobbie joined Rathbones in October 2005, having graduated from the University of Strathclyde Business School with an MSc in Finance. He also holds degrees from the Universities of Glasgow and Edinburgh. Alan specializes in Pan-European equities, and has assisted in the management of various institutional and retail funds within Rathbone Unit Trust Management. In addition, Alan holds the Investment Management Certificate and is a Chartered Financial Analyst charter holder.

Carl Stick
Joined 01/01/2000

Mr. Stick transferred to London in August 1998, after Rathbones acquired Neilson Cobbold in 1996, where he became an assistant fund manager for the unit trust business, working alongside Hugh Priestley. Carl is a Board Director of Rathbone Unit Trust Management and plays a key role in the development of Rathbones’ investment process and business strategy. Carl graduated from the University of Southampton in 1991 with a BA Honours degree in English Literature. He is also I.I.M.R.-qualified and a Fellow of the Securities Institute.

Data provided by Morningstar.

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You should be aware that prices may fall as well as rise and that the income derived can go down as well as up. When buying or selling any investment that fluctuates in price or value you may get back less than you invested. Past performance is not necessarily a guide to future performance.