Fund of the week: An unbroken record of solid returns
Jan 27, 2012
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When a fund makes it into the Hargreaves Lansdown Wealth 150 list, it is usually one to watch. The latest member of the club, the Troy Trojan Income Fund, is no exception. Over the last five turbulent years it has returned 28.6%. That’s impressive when you consider that its peers in the IMA UK Equity Income sector have lost 2.5% over the same period.
Hargreaves Lansdown’s head of research, Mark Dampier, praises the fund’s “unbroken record” of growing income payment every year since launch in 2004. That’s encouraging, says Dampier, because it indicates that “this is the sort of portfolio that could perform well in an uncertain economic climate”.
One reason it’s performed better than rivals in a tricky investment environment is its willingness to hold cash. Although returns are low from this asset class, the fund is able to exploit what Société Générale’s Dylan Grice has called its “dry powder” value. “The manager of the Troy Trojan Income Fund, Francis Brooke, often lets cash build up if he believes he will be able to acquire shares that interest him at a lower price in the future,” says Dampier.
As you’d expect from an income fund, Brooke invests in many of the well-established dividend giants, such as Vodafone and Diageo. Yet the fund also has exposure to smaller firms, such as Greggs, the high-street baker. That may increase its risk slightly, as shares in smaller firms tend to be more volatile, but it allows Brooke to bag higher dividends. Unlike some of its peers, the fund can also invest abroad and holds overseas dividend heavyweights, such as Nestlé.
Contact 020-7499 4030.
Troy trojan Income Fund top ten holdings
| Name of holding | % of assets |
|---|
| Vodafone Group |
4.5% |
| GlaxoSmithKline |
3.5% |
| Royal Dutch Shell |
3.5% |
| Imperial Tobacco Group |
3.4% |
| British American Tobacco |
3.3% |
| BP |
2.9% |
| Diageo |
2.9% |
| AstraZeneca Plc |
2.9% |
| Unilever |
2.9% |
| Centrica Plc |
2.8% |
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