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Invesco Perpetual launches Global Equity Income Fund

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Invesco Perpetual has launched the Global Equity Income Fund, a diversified fund that seeks to achieve a total return of income and capital growth by investing in the best investment id

Invesco Perpetual has launched the Global Equity Income Fund, a diversified fund that seeks to achieve a total return of income and capital growth by investing in the best investment ideas of all the regional equity specialists based in Henley.

Paul Boyne, the fund manager, is looking to target a dividend yield above that of the MSCI World Index. For the market (as represented by the MSCI World index), the company has forecast a dividend yield of around 3.4 per cent.

The fund offers exposure to the stock ideas selected from Invesco Perpetual’s UK, Europe, US, Japanese, Asian and emerging market equity investment teams, but can also select an equity investment not owned by these teams if, in Boyne’s analysis, there is a compelling reason for its inclusion.

The fund has no inherent bias towards particular sectors, stocks, styles or market capitalisation ranges. Sector weights are a consequence of the stock investment decision, but no single sector may account for more than 30 per cent of the fund.

Invesco Perpetual says it intends to invest in high quality companies offering visible growth and attractive valuations, with a focus on companies generating strong free cashflow and using a progressive dividend policy, share buybacks, or a value enhancing growth strategy.

The fund will hold between 60 and 100 stocks, and the firm currently anticipates that it will normally hold around 75, each of them based on their relative merits.

Some examples of stocks which Boyne has included in his notional portfolio include Johnson & Johnson, Philip Morris International, Nestle and Honda.

‘Going forward, we believe that there will be significant opportunities for high-quality businesses with sustainable and defensible franchises to outperform their more-mediocre peers,’ the firm says. ‘In the current recession, company returns are falling rapidly, on aggregate. However, we believe the cyclical earnings decline is now to a great extent priced into equity markets. By a number of measures, equities are cheap. As hedge funds and other investors have had to sell their more liquid assets in order to fund withdrawals, there are now many high-quality companies trading at their most attractive valuations for decades.’

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