Three reasons to invest in equity income funds

ON UK INCOME

Liontrust's James Inglis-Jones reveals why he thinks equity income funds are currently an attractive bet.

There is a strong case to invest in income funds today. Investing in an equity income fund holds out the possibility of an attractive yield on your investment with the added benefit that comes from an investment in real assets – inflation protection. There are two other reasons we believe equity income funds are particularly attractive today. First, normalised measures of valuation tell us equity markets are expensive. This implies investors should be better off targeting yield as a source of return as opposed to capital growth. Second, it seems clear from a review of market history yiel...