The most popular UK income fund with the professionals – and it’s still not Woodford

Threadneedle

Richard Colwell’s £3.2bn Threadneedle UK Equity Income fund is the most popular UK equity income fund with multi-asset managers in the Investment Association universe, according to the latest FE Trustnet study, overtaking Artemis Income which sat at the top of the list last year. According to FE data, the Columbia Threadneedle fund sits at the top of the popularity tables with funds of funds managers as some 29 multi-asset portfolios count the three crown-rated vehicle as a top 10 holding – three more than Majedie UK Income, which sits in second place.

The soaring arm has got increasing number of followers

Despite a soaring AUM and an increasing number of followers, the now £8.3bn CF Woodford Equity Income fund is still only in third place as it features in 23 top 10s. However, that is an increase from last year when 18 funds held it in their list of biggest holdings.The last two years’ favourite, Artemis Income, has fallen to fourth spot as while 57 and 36 funds held it their top 10 in 2014 and 2015, respectively, that figure has fallen to just 22 this time around.

What is also noticeable is the absence of FE Alpha Manager Mark Barnett’s three UK equity income funds. In fact, just eight multi-asset funds hold Invesco Perpetual Income in their top 10, only five have Invesco Perpetual UK Strategic Income and Ingenious Global Growth is the only portfolio to have Invesco Perpetual High Income as a top 10 position, despite its £12.6bn size.Turning back to the top of the list, though, and Colwell (pictured) – who assumed sole responsibility of the portfolio from Leigh Harrison in October last year – has some notable backers.

Columbia ThreadNeedle manages the top 10 of 29 funds

Though six of those 29 funds that hold it in their top 10 are managed by Columbia Threadneedle, the likes of Bambos Hambi have sizable stakes in Threadneedle UK Equity Income within his Standard Life Investments MyFolio range and Tilney Bestinvest uses the fund in six of its OEICs.Interestingly, however, 33 funds held Threadneedle UK Equity Income in their top 10 this time last year.The Threadneedle fund has one of the best long-term track records in the IA UK Equity Income sector and since Colwell was named a manager on the portfolio in September 2010, it sits comfortably in the top quartile with gains of 77.73 per cent.

The fund has also made money and beaten the index in every year under Colwell’s stewardship. The fund is biased towards the larger end of the UK market, but Colwell aims to run a more contrarian portfolio than many of his peers in order to deliver an attractive starting yield.  For example, he holds the likes of GlaxoSmithKline, Marks & Spencer Group, Morrisons and Centrica in his top 10 and, as a result, Threadneedle UK Equity Income yields more than 4 per cent. To know more news on finance and trade, you can follow us at https://twitter.com/financetradingn

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