Fund pickers are broadly sanguine on the Investment Association's (IA) decision to lower the UK Equity Income sector's yield hurdle from 110% to 100% of the FTSE All-Share index, though some argued a relaxation of the rules could lead managers to make "bad decisions".
The IA announced its decision to lower the yield hurdle following a consultation period that begun last April. The body also said a failure to achieve 90% of the index yield in any one-year rolling period would result in a fund being removed from the sector. Previously, the IA's sector definition said: "Funds that fail to meet the 110% average yield for each three year rolling period will be removed from the sector." This resulted in many high-profile funds being moved to the UK All Companies sector including the Invesco Perpetual High Income and Income funds, Rathbone Income and Evenlod...
To continue reading this article...
Join Professional Adviser for free
- Unlimited access to real-time news, industry insights and market intelligence
- Stay ahead of the curve with spotlights on emerging trends and technologies
- Receive breaking news stories straight to your inbox in the daily newsletters
- Make smart business decisions with the latest developments in regulation, investing retirement and protection
- Members-only access to the editor’s weekly Friday commentary
- Be the first to hear about our events and awards programmes