UK equity income funds seeing rise in popularity

Trends

Falling interest rates and higher yields are helping to boost investment into the sector

UK equity income fund launches are back in fashion, with eight coming onto the market in 2002, twice as many as in the three preceding years combined. This compares to just one launch in the bull market of 1999, when such funds were considered by some to be obsolete, one in 2000 and two in 2001. Angus Duncan, former head of investment sales at Skandia, said while fund groups seeing their rivals take lots of money into their UK equity income portfolios would naturally be prompted to launch their own vehicles, there have been a number of structural reasons for their popularity of late. "I...