US equity specialist launches Enhanced Income fund for UK

US equity specialist Cullen Capital Management is expanding its reach into the UK with the launch of a second UCITs vehicle, the Cullen US Enhanced Equity Income fund.

The fund will be based on an existing strategy, the $600m Cullen North American High Dividend Value fund, which launched in the UK in 2010. The new vehicle will invest in the same portfolio of stocks as the Value fund but add a covered call option overlay on up to 40% of the portfolio in a bid to keep volatility low. Manager Jim Cullen hopes the fund will achieve 6%-7% income per annum, but with a volatility level closer to that of a bond fund. "The search for income continues apace across the globe, and this strategy has been designed for clients seeking alternatives to fixed inco...