Diversification and small caps key to better returns

UK EQUITY INCOME

UK Equity Income sector sees three-year performance bolstered by small-cap exposure and diversification of dividends

Playing the UK stock market over the past three years has been a game of two halves. Managers faced a battle to beat their peers as markets soared in early 2007, and then plummeted when the credit crisis took hold. Income seekers in the UK have faced the dual challenge of preserving both capital and income during a turbulent period for dividends, as banks and oil major BP were forced to cut their payouts. Within the IMA’s UK Equity Income sector, the average fund fell 11.29% over the three years to 1 September, although performance has come back over one year, with an average 11.37% r...