Hargreaves Lansdown has revealed its initial portfolio for its high income fund, which launches in April.
Sidestepping some of the many star managers in the UK equity income space, managers Lee Gardhouse and Ellen Powley have picked smaller funds, including two Artemis funds: global equity income and high income.
Hargreaves Lansdown has previously said the fund would comprise approximately 60 per cent shares and 40 per cent bonds. The fund, which launches April 12, has an expected yield of 4.5 per cent.
Jupiter’s Asian income fund was among the equity picks, while Royal London features twice in the bonds picks with the corporate bond and sterling extra yield bond funds.
“Generating an attractive income from savings and investments in the current world of ultra-low interest rates is a real challenge,” says Gardhouse.
“Many traditional sources of income have evaporated, with instant access deposit accounts offering virtually no income and government bond yields at historically low levels.”
“We are aiming to blend together some serious investment talent, UK managers who offer different strengths and investment strategies which complement each other, in one income portfolio.”
In contrast to most income funds, which pay quarterly or bi-annually, dividends will be paid monthly.
The fund is expected to appeal to pension freedom investors and Isa investors who need a sustainable income. Up until its launch date units will be sold at a fixed price of £1.