Allianz UK equity fund to use covered call

Allianz Global Investors has announced it is diversifying the strategy of its RCM UK Equity Income fund which aims to achieve high and increasing income together with capital growth. Simon Gergel, manager of the fund which already has one of the highest yields in the sector, believes income can be raised and overall returns improved by writing covered call options on up to 20pc of the fund’s holdings. Gergel said: “With the introduction of UCITS III we now have wider powers to enhance returns including the use of derivatives. "We believe the introduction of writing covered call opt...