Interactive Investor

The most and least consistent UK equity income funds

12th August 2019 14:33

Tom Bailey from interactive investor


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While most funds have struggled of late to produce a positive return, Neptune Income was able to give investors a return over the year of 5.6%, to the end of June.  

The Neptune Income fund has topped Sanlam’s ‘white list’, which highlights the most and least reliable UK equity income fund performers.

Sanlam’s Income Study, which has been running for over 30 years, is carried out twice a year. Each fund is then placed into one of three categories: White List, Grey List, and Black List. In total, the performance of 62 funds was examined.  

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The study looks at a number of factors. These include the absolute income generated by the fund over the past five calendar years, capital growth for each of the past five 12-month periods and volatility over the past five years. Moreover, the most recent period of performance, how the fund has fared over the past year, receives a greater weighting.

While most funds have struggled of late to produce a positive return, Neptune Income was able to give investors a return over the year of 5.6%, to the end of June.  

Partly as a result of this, Neptune topped the White List. Over the past five years, it generated income of £206, based on a £1,000 investment. The fund moved up 25 places from the previous study.

It was recently announced that asset management company Liontrust will be purchasing Neptune. The funds will continue to be managed by veteran fund manager Robin Geffen.

Next on the White list was Man GLG UK Income. While the fund has produced a loss over the past year (-1.1%), its five-year performance has seen it generate £226 of income, again on £1,000 invested.  

In third place is LF Miton UK Multi Cap Income, while Santander Equity Income and Aviva Investors UK Equity Income complete the top five.

The Troy Trojan Income Fund, previously in first place, dropped 11 places to number 12. The report notes “whilst performance over the past year has been strong, total income distributed to investors has disappointed over the longer term”.

On the Grey List, Ardevora UK Income rose by 32 places. This is the result much of a notable improvement in performance.

Meanwhile, the Black List contained Unicorn UK Income, HSBC Income, and Aberdeen UK Equity Income.

The poorest performers were UBS UK Equity Income, L&G Equity Income, and Janus Henderson UK Equity Income and Growth, all placed at the bottom of the Black List.

Threadneedle UK Equity Alpha saw the sharpest fall, tumbling by 43 places. Both Standard Life Investments UK Equity Income Unconstrained and Standard Life Investments UK Equity High Income entered the Black List, having previously been placed on the Grey List.

The full study and tables for each list can be found here

This article was originally published in our sister magazine Money Observer, which ceased publication in August 2020.

These articles are provided for information purposes only. Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties. The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.

Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.

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