Royal London UK Equity Income M

UK Equity Income

Rated Fund 2017-20. Offers mix of large and small companies      

UK equity income fund veteran Martin Cholwill has led this fund well since 2005 and experienced strong asset growth as a result - assets have broken through £2 billion. It is a solid long-term performer with a good yield of 4.2% and pays income quarterly. Cholwill favours a concentrated portfolio of  40 to 60 stocks (50 at present), which means each of his ideas contributes meaningfully to performance. He can invest in companies of any size but tends to have a bias towards medium-sized ones, albeit his top 10 holdings are centred on some big FTSE 100 dividend stocks to keep the income up.

"This fund invests more down the market capitalisation spectrum, so would be complementary to a core UK equity income fund, though there would be an element of overlap and it would be a bit riskier," says Adrian Lowcock, head of personal investing at Willis Owen, the investment platform. The fund invests across a broad spectrum of industries in which Cholwill sees value, in particular focusing on companies with attractive cash flow that are able to support a growing and sustainable dividend. As he points out, it is cash flow that pays the dividend, funds investment for future growth and helps provide resilience in a range of market conditions.

The fund is underpinned by cautious economic growth assumptions, and its focus on strong market positions, cash flow-backed dividends and robust balance sheets should provide resilience in a range of possible economic outcomes. However, Cholwill says it is stock selection, based on thorough company research, including meeting management teams, that is the main driver of his performance.

Narrative and ratings content all as of January 2020.

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Name
Royal London UK Equity Income M
Manager
Royal London Unit Trust Managers Ltd
Type
Open Ended Investment Company
ISIN
GB00B3M9JJ78
Sector
UK Equity Income
Launched
05/11/2010
OCF
0.72 %
Risk Rating
3
3 Year Sharpe
-0.18
3 Year Alpha
-0.40
Yield
5.6 %
Benchmark
FTSE AllSh TR GBP
The investment objective and policy of the Fund is to achieve a combination of income and some capital growth by investing mainly in UK higher yielding and other equities, as well as convertible stocks. The Fund may hold transferable securities, (including Exchange Traded Funds which are closed ended funds, but not those which are collective investment schemes), government and public securities, deposits and cash (for the purposes of EPM and redemption of units). It may also hold derivatives for the purposes of EPM only
Holding %
Royal Dutch Shell PLC B 5.71 %
AstraZeneca PLC 4.77 %
GlaxoSmithKline PLC 4.47 %
BP PLC 4.11 %
HSBC Holdings PLC 3.42 %
Land Securities Group PLC 3.19 %
British American Tobacco PLC 2.69 %
Rio Tinto PLC 2.64 %
Close Brothers Group PLC 2.58 %
ITV PLC 2.46 %
Region %
United Kingdom 100.00 %
Sector %
Financial Services 21.61 %
Industrials 14.73 %
Communication Services 11.48 %
Energy 10.25 %
Healthcare 9.64 %
Consumer Cyclical 7.64 %
Basic materials 6.81 %
Utilities 5.84 %
Consumer Defensive 5.12 %
Name
Royal London Unit Trust Managers Ltd
Address
EC3V 0RL, London, United Kingdom
UCITS
Yes
Legal Structure
Open Ended Investment Company

Managers

Martin Cholwill
Joined 03/01/2005

He became a Fund Manager in 1983 and joined AXA’s UK Equities team as an analyst. During the 21 years that Martin worked for AXA he managed a variety of UK equity portfolios. Finally as a specialist UK equity income Manager he took over management of AXA’s UK Equity Income Fund in 1996. Martin joined RLAM and took over management of the Royal London Equity Income Trust in March 2005.

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.