Income portfolio research + ideas

sixpence.

Bowhead, thanks for taking the time to share some of your wisdom.

I think trustworthy was the wrong word to describe the VLS. What I mean is that it is diversified and low cost, following multiple indexes. If there was some kind of equivalent multi asset fund with a 3.5-4% yield then that would be great.

I have looked into what the stars and crowns mean I am aware that they only cover the last 3 to 5 years and are predominantly performance-based. It's quite clear on the trust.net website.

I am tempted now to make my portfolio 30 to 40% UK (or even more) and be done with it. I like the idea of having a globally balanced income Portfolio because of wrecks it and rising socialism (which I am very much politically in favour of, as a sidenote)

From the research I've done a 3.5-4% yield will leave some room for growth, as some income portfolios go up to a 6% yield. As I said, I'm not predominantly looking for growth in this portfolio by any means, but I do want some.

Grey gym shorts: thank you so much for these, I will check them out. Have you researched them yourself?

Thanks to everyone who has responded. Has anyone on here used a Hargreaves Landsdowne IFA? What are your favourite multi-asset income funds?

grey_gym_sock

sixpence. wrote: »

Grey gym shorts: thank you so much for these, I will check them out. Have you researched them yourself?

i've only glanced at them, really. i'm not looking for something in this area myself.

these funds are perhaps unusual, in that they're aiming for income, while using mostly passive components.

on the shares side, they are partly doing this by putting more into the higher-yielding regions of the world, but just using cap-weighted trackers (not specifically income-focused funds) for each region. though they (or at least, 1 of them) are also uses at least ishares UK dividend ETF (a fund which does target a higher income).

on the bonds side, there is quite a fair bit of high-yield and emerging markets stuff. some people say you should take your risk on the shares side, not with bonds; these funds are not following that philosophy. but i suppose this is what you get when you go for higher income.

the funds use "risk targeting", i.e. they will adjust their portfolio in response to changes in the volatility and returns of assets, in an attempt in maintain a constant-ish level of volatility for each fund. this is something these L&G multi index income funds have in common with the L&G multi index funds. personally, i don't like this approach, but opinions differ.

oh, full disclosure: i hold shares in L&G, so i might be biased. though this post isn't turning out much like a sales pitch, anyway ...

firestone

for income & growth have you considered SAINTS IT?

bostonerimus

sixpence. wrote: »

I think trustworthy was the wrong word to describe the VLS. What I mean is that it is diversified and low cost, following multiple indexes. If there was some kind of equivalent multi asset fund with a 3.5-4% yield then that would be great.

Yield is just one source of income......capital growth is another. If you can get 1.5% or maybe 2% yield then you can get the rest from capital gains.

bostonerimus

firestone wrote: »

for income & growth have you considered SAINTS IT?

I love that the ticker symbol is SCAM

firestone

bostonerimus wrote: »

I love that the ticker symbol is SCAM

yeah is a bit unfortunate that
But there was an piece on Trustnet over the weekend about them saying over 10 years income of £4593 on £10000 and made 156% over that time so a bit better then a dodgy scheme

(also for the OP there is a small part of non equity)

bostonerimus

firestone wrote: »

yeah is a bit unfortunate that
But there was an piece on Trustnet over the weekend about them saying over 10 years income of £4593 on £10000 and made 156% over that time so a bit better then a dodgy scheme

(also for the OP there is a small part of non equity)

This isn't directly relevant to the OP, but in the US, Vanguard has some very popular balanced funds that are used for income, but they don't have something similar in the UK. They are the Wellington and Wellesley funds which have a mix of stocks and bonds, 60/40 and 40/60 and yields of 2.5% and 3% respectively. Like SCAM they are old funds Wellington having started in 1929. By analogy a combo of some high dividend paying value stock and corporate bond funds/indexes might work for the OP.

https://personal.vanguard.com/us/funds/snapshot?FundId=0527&FundIntExt=INT&funds_disable_redirect=true

https://personal.vanguard.com/us/funds/snapshot?FundId=0521&FundIntExt=INT&funds_disable_redirect=true

digannio

One of my main income sources is Artemis Monthly Distribution Fund. I chose it because I wanted a globally diversified mix of bonds and equities paying out monthly with two good fund managers with a decent past record between them. The charges aren't out of this world for this kind of active fund and so far, after four years, it has pretty much done what it says on the tin... paid around 4% with some capital increase along the way. I realise things won't always go as smoothly and there will be some bumps and big potholes in the road ahead but I'm in it for the long haul.

chrisgg

A simple medium risk income portfolio could be something along the lines of:

Axa Framlington Monthly Income - 30% - 4.3% yield
Artemis Global Income - 30% - 3.6% yield
Liontrust Monthly Income Bond - 40% - 5.7% yield

This is of course under the assumption that you are willing to put in the effort to rebalance when necessary and keep an eye on how the active managers are doing in relation to their peers. Unfortunately I've yet to come across many low cost passive strategies that are able to fulfil the dual purpose of providing some capital growth and decent yield; it is one of the main areas where going active is worthwhile, even for retail investors.

sixpence.

Thanks so much everyone for the helpful replies

At what point do you think it becomes wiser to have a bespoke portfolio rather than one which either revolves around, or consists entirely of, a multi-asset fund? Six figures?

firestone wrote: »

for income & growth have you considered SAINTS IT?

can't find this on Hargreaves Lansdown, you have a link I could look at? On fund finder it seemed that there weren't many bonds it was mostly equity.

digannio wrote: »

One of my main income sources is Artemis Monthly Distribution Fund. I chose it because I wanted a globally diversified mix of bonds and equities paying out monthly with two good fund managers with a decent past record between them. The charges aren't out of this world for this kind of active fund and so far, after four years, it has pretty much done what it says on the tin... paid around 4% with some capital increase along the way. I realise things won't always go as smoothly and there will be some bumps and big potholes in the road ahead but I'm in it for the long haul.

Thanks a lot. Is this the fund you are talking about:http://www.hl.co.uk/funds/fund-discounts,-prices--and--factsheets/search-results/a/artemis-high-income-class-i-monthly-income.

This looks great. It's just a little weighted to the UK for my liking, and focuses more on income than a mix of growth and income.

chrisgg wrote: »

A simple medium risk income portfolio could be something along the lines of:

Axa Framlington Monthly Income - 30% - 4.3% yield
Artemis Global Income - 30% - 3.6% yield
Liontrust Monthly Income Bond - 40% - 5.7% yield

This is of course under the assumption that you are willing to put in the effort to rebalance when necessary and keep an eye on how the active managers are doing in relation to their peers. Unfortunately I've yet to come across many low cost passive strategies that are able to fulfil the dual purpose of providing some capital growth and decent yield; it is one of the main areas where going active is worthwhile, even for retail investors.

Thanks for the list. I going to add these to my research list

I think I understand the concept of rebalancing, in the sense that it's about making sure the percentages of the funds remain equal.
I am not sure how I would go about comparing a fund manager to their peers? Would this just involve looking at other funds on a graph every so often...