The company, which already has two income funds, says the new fund, which will be launched subject to regulatory approval, is being created in response to “increasing investor demand for high-quality income streams.”
The CF Woodford Income Focus Fund will have an investment objective of high income generation together with capital growth. The company says that based on a launch price of 100p investors should be aware that the fund will not target a specific yield and there is no guarantee that any specific level of yield or income will be achieved over any given time period.
It will aim to deliver an income of 5p per share per annum and will invest in a concentrated portfolio of market-listed securities. While it will not be constrained by geographical region, the fund will predominantly be UK focused at the outset, says Woodford.
Full disclosure of the CF Woodford Income Focus Fund’s portfolio and breakdown of fees will be provided on a monthly basis to aid transparency. Fund related expenses will be absorbed into the fund’s annual management charge (AMC), meaning that the fund’s AMC and ongoing charge will be the same. The CF Woodford Income Focus Fund will have four share classes – see table below for details.
|
Share class |
Initial fee |
AMC |
OCF |
Exit fee |
|
A Inc & Acc |
None |
1.00% |
1.00% |
None |
|
C Inc & Acc |
None |
0.75% |
0.75% |
None |
|
Z Inc & Acc |
None |
0.65% |
0.65% |
None |
|
X Inc & Acc |
None |
1.50% |
1.50% |
None |
The fund will be managed by veteran fund manager Neil Woodford to complement the existing equity income strategy by offering a higher level of income alongside a lower long-term risk profile.
Neil Woodford, head of investment, Woodford Investment Management, said: “The level of income you can generate from an income-focused equity portfolio today is extremely attractive in the context of what is available from other asset classes.
“The fund will draw on my long-held investment philosophy and reflect my investment convictions. It will have a more concentrated portfolio, with a focus on dividend-paying stock market-listed securities and no geographic constraints - allowing me the flexibility to capture income from international equities when, and if, appropriate.
“This fund responds to investor demand for a Woodford fund which consistently generates a higher level of regular income, with no compromise on quality.”