Disclosure – Non-substantive Research
This is not substantive investment research or a research recommendation, as it does not constitute substantive research or analysis. With this commentary, Kepler Partners LLP does not intend to influence your investment firm's behaviour.
The task for income seekers is harder than it was at the start of the year. Across the developed world dividends are under threat, due to either collapsing revenues or government insistence. Meanwhile government bond prices have taken another leap up, with safe haven bonds and savings products linked to their yields generating ever more meagre payouts. As we discussed in our strategy piece last week, those who take their UK equity income exposure through investment trusts are in a better state, with their dividends less likely to be threatened in the short term, thanks to healthy revenue reserves. However, the revenue streams of some alternatives may prove more secure in the coming months and years. With that in mind, we discuss the relative benefits of leaning on equity income or alternatives for income.
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