5 EQUITY INCOME FUNDS THAT SCOUR THE WORLD FOR PROFIT

1 GUINNESS GLOBAL EQUITY INCOME

THIS fund seeks out quality companies paying dividends that can grow over time. It currently yields an income equivalent to 2.6 per cent. The fund invests in companies that make household essentials, such as Pepsico and Johnson & Johnson – as well as industrial and healthcare companies such as the American pharmaceutical company AbbVie.

The portfolio comprises 35 stocks, each of which have the same weighting.

Interestingly, fund managers Ian Mortimer and Matthew Page don’t think about dividends until quite late in their stock selection process.

Page says: ‘To identify companies with strong dividend growth, we believe the best place to start is by looking at the cash flow they have generated over the last ten years. We then whittle down our list to those companies with strong balance sheets and low levels of debt. Only then do we consider dividends.’

2 MURRAY INTERNATIONAL

A STOCK market-listed trust yielding an income equivalent to four per cent a year.

Dzmitry Lipski, head of fund research at investment platform Interactive Investor, says:

‘Unlike its peers, this trust has almost half of its portfolio invested in Asia, Latin America and other emerging markets.’

The trust is run by Bruce Stout at Aberdeen Standard Investments. Holdings include companies such as Mexican airport operator Grupo Aeroportuario and Chilean chemical company SQM.

3 BAILLIE GIFFORD RESPONSIBLE GLOBAL EQUITY INCOME

THE managers exclude stocks in certain industries such as tobacco and alcohol – focusing instead on businesses that stick to strict sustainability criteria.

Top holdings include US consumer giant Procter & Gamble, Swiss companies Nestle and Roche and US tech firm Microsoft. Bestinvest’s Jason Hollands says: ‘The fund is a compelling choice for those seeking a rising income from responsible equity investments.’

It currently offers an income of around two per cent.

4 EVENLODE GLOBAL INCOME

IT LOOKS for companies that will grow dividends over the long term.

Unlike many rivals, nearly a fifth of its portfolio is in UK companies – the likes of Unilever and analytics company RELX that generate their revenues worldwide. The fund provides an income of around two per cent.

5 VANGUARD GLOBAL EQUITY INCOME

ITS portfolio comprises 134 companies and yields 2.8 per cent. One attractive feature is that its annual charges of 0.48 per cent are half that of most rivals.

Top holdings include health care company Pfizer, science and technology company Merck and insurer Axa.