UK Equity Income sector continues to hemorrhage money

Jonathan Boyd
clock • 1 min read

Data published in Morningstar's report UK Equity Income Funds Struggling to Retain Assets suggests that the there has been only one month since April 2016 in which it recorded net inflows.

This matters, because the category is still one of the largest for UK domiciled funds, and houses a number of the most high profile managers and funds in the UK market.

In all, some £15.3bn flowed out of the category between January 2016 to April 2019, when total assets were around £64bn. It is a category that has struggled when compared to other UK equity categories and benchmarks over that period, Morningstar adds.

As per recent news in both business and consumer press, the much discussed LF Woodford Equity Income fund saw some £3bn flow out over the period covered by the research, although others have managed to fare relatively better, such as the Troy Trojan Income fund, which saw some £829m of net inflows over the period, or the Man GLG UK Income fund, which outperformed the category average by some 5.5% annualised since the beginning of 2016, Morningstar notes.

Bhavik Parekh, associate analyst, Manager Research, said: "The performance of UK Equity Income funds has been especially poor in recent years. However, some managers within the category have managed to shine through, producing strong returns and attracting investor interest. They demonstrate that, with improved returns, the category may manage to attract back some of the investors it has lost."

To read the full report, click below.

Jonathan Boyd
Author spotlight

Jonathan Boyd

Editorial Director of Open Door Media Publishing Ltd, and Editor of InvestmentEurope.