UK companies well positioned to weather uncertainty
David Smith , Portfolio Manager of Henderson High Income , discusses the Company ’ s impressive dividend record , UK equity market valuations and areas where he is finding performance , the comeback of bonds , and the outlook for UK dividends in a recessionary environment .
· Henderson High Income has increased its dividend for 10 consecutive years , making it one of the AIC ’ s Next Generation Dividend Heroes . This success is underpinned by good quality companies with strong business models and balance sheets , whilst effectively utilising the investment trust structure .
· Yields on high quality government and investment grade corporate bonds have repriced to levels not seen in
decades . This has presented us with an opportunity to increase our bond exposure , notably through high quality US and UK investment grade credit .
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The dividend outlook for the UK remains encouraging . Companies are entering the recession in good financial health and have solid balance sheets which should help them to weather difficult times whilst continuing to pay and grow dividends .
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Important information
References made to individual securities should not constitute or form part of any offer or solicitation to issue , sell , subscribe , or purchase the security . Janus Henderson Investors , one of its affiliated advisors , or its employees , may have a position mentioned in the securities mentioned in the report . Not for onward distribution . Before investing in an investment trust referred to in this document , you should satisfy yourself as to its suitability and the risks involved , you may wish to consult a financial adviser . This is a marketing communication . Please refer to the AIFMD Disclosure document and Annual Report of the AIF before making any final investment decisions . Past performance does not predict future returns . The value of an investment and the income from it can fall as well as rise and you may not get back the amount originally invested . Tax assumptions and reliefs depend upon an investor ’ s particular circumstances and may change if those circumstances or the law change . Nothing in this document is intended to or should be construed as advice . This document is not a recommendation to sell or purchase any investment . It does not form part of any contract for the sale or purchase of any investment . We may record telephone calls for our mutual protection , to improve customer service and for regulatory record keeping purposes .
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