Fund Research

TwentyFour Income Fund

Last update 26 July 2018

TwentyFour Income Fund targets a 6%-9% return with a minimum 6p dividend a year from a portfolio of asset-backed securities with floating rate coupons protected against interest rate rises.

This total return NAV target has been met, while the dividends have also been well above the intended minimum. The managers believe that there is strong technical support behind the market as more institutional investors seek floating rate exposure in a rising interest rate environment, which should support NAV total returns in the coming years.

The members of the management team – Rob Ford, Ben Hayward, Aza Teeuwen, Douglas Charleston and John Lawler – are all highly experienced specialists in this market, allowing them to take full advantage of small and less liquid opportunities.

The trust has tended to trade on a small premium for most of its life, but the board will not issue shares to dilute existing shareholders unless the portfolio managers believe there are sufficient opportunities to allow them to achieve their targeted return.

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