Zeros better than equities & bonds, says F&C

Zero dividend preference shares have a better risk/return profile than either UK equities or governm...

Zero dividend preference shares have a better risk/return profile than either UK equities or government bonds, Peter Hewitt, manager of the £37m F&C Progressive Growth Fund, commented at a recent London conference. Zeros are still a widely misunderstood asset class and many investors are unsure as to whether they should be used as a form of equity, an alternative to fixed income or a cash proxy, he noted. Hewitt explained that for his portfolio he targets what he terms as high quality zeros, linked to trusts that have little in the way of gearing and are not caught up in cross shareholdin...