ISA Share Issue: Cautious BIPS manager Rhys Davies says bond markets still in a sweet spot for income investors
09 February 2026
QuotedData
Gavin Lumsden
Invesco Bond Income Plus (BIPS), the largest and one of the more cautious funds in the Loan & Bonds sector, is issuing a new tranche of its 7%-yielding shares, but income investors who want to take advantage must move quickly as the offer ends at 2pm on Thursday.
The £423m investment company’s share issue kick starts an effort to raise up to 20% more capital so as to expand the asset base and further reduce shareholders’ costs as a percentage of the portfolio.
According to Morningstar data, BIPS is already the cheapest in its five-fund sector, charging total annual ongoing charges of 0.89% versus an average of 1.19%.
Over the past five years, since it re-launched from the merger of City Merchants High Yield and Invesco Enhanced Income, BIPS can’t claim to have been been the best performer in its peer group. Its 30.6% total shareholder return over the past 60 months is in fact the lowest in its group where the average return has been almost 48%.
However, that reflects a lower risk stance by fund managers Rhys Davies and Edward Craven who spread the portfolio across a large number of stocks (239) and avoid concentrated positions. Their largest exposure to one issuer is 2.9% in three of Lloyds bank’s high-yield bonds, for example.
BIPS’ 5.4% yield to maturity, which the fund will get if it holds all its loans and bonds until they are repaid, and the 7% dividend yield on its shares are also slightly below the peer group, indicating a bit less risk to capital.
Gearing, or borrowing, is also low at just under 3% at the end of December.
Nevertheless, BIPS has a good track record in dividends, steadily lifting the pay-out from 10p per share in 2020 to 12.25p last year, covered by earnings, or income from investments.
Davies, lead manager of the fund, is conscious that with 54% of assets in the riskiest non-investment grade corporate bonds, and a further 11% unrated, he has to be careful to strike the right balance when buying the loans of companies with stretched balance sheets or chequered credit histories.
Despite their higher risks, high yield bonds have been popular as central banks have cut interest rates and investors have sought out better levels of income. While subdued, economic growth has been strong enough to avoid a rise in corporate loan defaults. As a result, the sector has notched up nine successive positive months since last April when US President Trump unveiled his global tariffs.
Eye on inflation
After their good run, average corporate bond yields in Europe have fallen to below 6% as their price has risen. Also the “spread”, or gap, between their yields and those of benchmark government bonds have narrowed to historic lows, which is another sign, Davies said, that investors should be wary of becoming complacent as an economic setback could cause those spreads to widen and bond prices to fall.
That said, there are plenty of opportunities with loan and bond issuance remaining strong in response to investor demand. Last month Davies, who appeared on our “Income funds for your ISA” broadcast on 30 January, bought into a new 10-year bond with an attractive 8%-coupon from French sugar producer Tereos.
He said his priority was to keep an eye on inflation and maintain a low exposure to interest rate risk by focusing on shorter-dated loans and bonds of three to five years. Another surge in inflation would require central banks to raise interest rates, which would hit longer-dated debt the hardest, he explained.
Before Russia’s invasion of Ukraine in 2022, Davies said: “I didn’t have to worry about inflation. For the rest of my career I will have to.”
Like its rivals, BIPS shares have been trading at a small premium of 1.7% over the net asset value of the trust’s investments. The offer lets investors buy in at a slightly lower premium of 0.75%.
“This is a timely opportunity for investors still looking to make use of their ISA allowance, while also gaining exposure to a trust that has historically delivered regular income. Bonds remain a compelling option for those wanting a steadier income stream, even through market turbulence, and BIPS is designed to deliver that through a disciplined, diversified approach,” said Davies.
Invesco Bond Income Plus (BIPS), the £443m high yield debt fund that raised £25m from investors last month, says it is conservatively positioned for the uncertainty stemming from the Middle East as the 7%-yielder reports a steady 8.7% total return for last year and plans to hold dividends at 12.25p this year. In its 2025 results chair Tim Scholefield said BIPS’ “closed ended structure makes it well positioned to take advantage of a sell-off when good quality bonds could be available at deeply discounted prices, locking in returns for the future.”
James Carthew of QuotedData said: “It is great to see BIPS delivering returns ahead of comparative indices and expanding. It is also pleasing to see how it has navigated the twists and turns of 2026, coming into the year positioned relatively defensively. The chairman points out that as a closed-end fund, it should be better able to take advantage of any sell-off in bond prices, when open-ended funds might be forced sellers. Let’s hope it doesn’t come to that, but it is a good argument for favouring trusts over other investment structures.”
There will be 1k to re-invest in the SNOWBALL this week. I am content with all the current income projections so I can start to add some stability to the SNOWBALL by buying some bonds.
5 High‑Yield Bond Engine (Monthly) ETF s
Here are five of the strongest High‑Yield Bond “Engines” that pay monthly, drawn directly from current market data and UK‑accessible ETFs. Each one is a pure fixed‑income product with monthly coupon flow, not equity‑based covered‑call funds.
Top 5 High‑Yield Bond (Monthly) ETFs
1) Fidelity Enhanced High Yield ETF (FDHY)
Yield: ~10% total return over past year
Payout: Monthly (~$0.26–$0.27 typical)
Profile: Actively managed BB/B junk‑bond sleeve
Notes: Fee cut to 0.35% boosts net income
2) SPDR Bloomberg High Yield Bond ETF (JNK)
Yield: ~6.7% trailing
Payout: Monthly ($0.49–$0.56 typical)
Profile: Tracks Bloomberg HY Very Liquid Index
Notes: Concentrated in cyclical, comms, energy sectors
3) iShares iBoxx $ High Yield Corporate Bond ETF (HYG)
Yield: 6%+ SEC yield
Payout: Monthly
Profile: ~1,000 sub‑investment‑grade corporates
Notes: Long history of stable monthly distributions
4) iShares J.P. Morgan EM High Yield Bond ETF (EMHY)
Notes: Strong, consistent monthly distribution history
5) PIMCO US Short‑Term High Yield Corporate Bond UCITS ETF (STHY / SSHY)
Yield: ~6.9–7.0%
Payout: Monthly
Profile: Short‑duration HY bonds (lower interest‑rate sensitivity)
Notes: Available in GBP‑hedged, USD, and EUR‑hedged share classes
Quick Comparison Table (Yields & Risk Profile)
ETF
Yield
Duration
Region
Risk Level
Monthly?
FDHY
~10% TR
Medium
Global HY
Medium‑High
✔️
JNK
~6.7%
Medium
US HY
Medium
✔️
HYG
6%+
Medium
US HY
Medium
✔️
EMHY
~6.7%
Medium
EM HY
High
✔️
PIMCO STHY/SSHY
~7%
Short
US HY
Medium
✔️
Which one is the “Engine”?
If you want maximum monthly income, the hierarchy is:
FDHY → Highest income engine (active, strong yield)
PIMCO STHY/SSHY → High yield with lower duration risk
EMHY → High yield but higher EM volatility
HYG / JNK → Large, stable, core HY exposure
OR
Looking at the chart, you can see that with BIPS there will be a capital drawdown in times of market stress.
Because the income is considered ‘safe’ it normally trades above its NAV.
As recently as 2020 as the price fell and the yield rose, anyone who put on their big boy/girls pants and bought would be receiving a buying yield of 11% and a running yield of 7%.
As BIPS trades above its NAV, the choice can be made between an ETF and BIPS. As the SNOWBALL is going to build a position with earned dividends, if the price fell it would be a positive and not a negative.
But not junk bonds as that is the opposite to low risk.
A fresh financial crisis may be coming – it won’t play out like the last one
Published 29 April 2026
BySimon Jack
Business Editor
On 15 September 2008, Bobby Seagull arrived at his office in Canary Wharf just before 6am.
It was the last time he would need to be on time. He was a trader at Lehman Brothers, an American bank undergoing serious turbulence.
“We had seen on the Sunday news from America, they’re filing for bankruptcy. We weren’t quite sure [what] the implication was [for] us in the UK. So we were just told to turn up as normal.”
Initially it was “chaos”, Bobby says. “There was no direct communication with our American colleagues. They weren’t picking up the phones. Some people were picking up items, like paintings on the wall and saying, ‘They owe me shares’.”
Bobby had an inkling that disaster might strike and was well prepared.
“I actually bought a shopping trolley on the last day. And funnily enough, that summer, people did sense a bit of disquiet. I emptied my vending machine card, [worth] £300 pounds, on chocolates, because I realised if the vending machine or the bank collapsed, my vending machine card would become defunct.”
Bobby, along with thousands of colleagues, carried his career out in a cardboard box. It was a defining image of the global financial crisis which saw thousands of businesses fail and millions lose their jobs. It ushered in one of the longest and deepest recessions since World War Two.
Image caption,In 2008, investment bank Lehman Brothers filed for bankruptcy in the US
Now there are a number of warning lights flashing on the world economic dashboard that have some wondering whether we are in the foothills of another financial crisis.
What could the next meltdown look like? And with international relations in 2026 in a more febrile state than they were in 2008, will policymakers even have the tools to solve it?
Early warning signal
Before the crisis that engulfed the world economy in 2008, there were early warning signals in some parts of the financial system.
In 2007, investments in risky US mortgages went sour as homeowners struggled to pay. Funds run by Bear Stearns, BNP Paribas and other banks either had to freeze the ability of investors to take out their money, or liquidate the funds completely.
These problems were the canaries in what proved to be a very deep financial coal mine. As nervousness spread, even banks eventually stopped lending to each other for fear of not getting their money back, creating a so-called “credit crunch”. That caused a global financial crisis.
Image caption,A crisis engulfed the world economy in 2008
Fast forward to today.
Several funds which lend money have declared losses or restricted investors’ ability to take out their money. BlackRock, Blackstone, Apollo and Blue Owl have all faced demands for billions of withdrawals from private credit funds – institutions that provide an alternative to traditional banks.
Bank regulators and financial veterans recognise the similarities.
Sarah Breeden is the deputy governor of the Bank of England, with specific responsibility for financial stability. She says the new world of private credit has grown quickly, has yet to be tested by financial adversity and is poorly understood.
“There are echoes of the global financial crisis in what we’re seeing now,” she says. “Private credit has gone from nothing to two and a half trillion dollars in the last 15 to 20 years. There is leverage [borrowed money], there’s opacity, there’s complexity, there’s interconnections with the rest of the financial system. All of that rhymes with what we saw in the GFC.”
She’s also worried that a lot of the money lent by private credit funds has itself been borrowed, creating layers of debt – or leverage – that can amplify any losses.
“There is leverage on leverage on leverage. What we want to make sure is that everybody understands how that layer cake of leverage adds up.”
Image caption,In 2007 huge queues formed at Northern Rock branches as people tried to withdraw their money
Mohammed El-Erian, chief economic adviser to German financial firm Allianz and former CEO of PIMCO, the world’s biggest bond investor, agrees that the risk of another crisis is underestimated.
“There are certain similarities with 2007 that keep me awake at night. The similarities are clear fragilities in the financial system that are not properly appreciated.”
In fact, he says, it was the restrictions placed on banks after the crisis that gave birth to this new private credit market. Banks were forced by new regulations to be more cautious, so funds that mimicked banks sprang up to fill the void.
“Suddenly the system is flooded with private creditors wishing to give money to companies. Companies see all this money available and of course too much money makes people make mistakes.”
He lays out a scary scenario: “Suddenly everybody that lends you money wants their money back at the same time. The next thing you know, something that started out as a really good idea grows into something that risks instability, and rather than benefitting the economy, it actually risks pulling the rug out from under it.”
But Larry Fink, the boss of the world’s biggest money manager, BlackRock, recently told the BBC he did not agree that private credit posed a threat to the world economy.
The issues affecting some funds account for a small fraction of the overall market, he says.
BlackRock itself is one of several firms to have limited withdrawals by nervous investors from private credit funds. But Fink is adamant there is no chance of a repeat of the financial trauma seen in 2007-08, as he believes financial institutions today are more secure.
“I don’t see any similarities at all,” he says. “Zero.”
Nevertheless, some have likened what is happening in private credit to a slow run on a bank. You may not see the queues outside branches of Northern Rock, as we saw in 2007, but there is a line of people wanting their money back.
Energy
Another way in which history might be repeating itself is through surging energy prices.
That was a contributing factor to the 2008 crisis. The price of Brent crude oil went from around $50 a barrel at the beginning of 2007 to $100 by the end of the year – eventually peaking at $147 in July 2008. It was driven by surging demand from a rapidly expanding China but also in part from geopolitical tensions involving Iran.
Today, oil prices have risen to over $100 a barrel, with warnings they could go higher if there is not a speedy resolution to a conflict with Iran that has in effect shut the world’s most important energy artery through the Strait of Hormuz.
Fatih Birol, chief executive of the International Energy Agency, has called the ongoing closure of the Strait of Hormuz “the greatest energy security crisis in history”, insisting it is “more serious” than the previous energy shocks in 1973 (when some Arab states imposed an oil embargo on the West), 1979 (caused by the Iranian revolution) and 2022 (Ukraine) “put together”.
That level of gloom is not yet reflected in current oil prices. Although they have risen more than 50% since before the conflict with Iran, they are some way off the levels seen before the last financial crisis, when oil hit $147 dollars a barrel (in today’s money, that’s close to $190 a barrel).
And stock markets are currently at or near all-time highs – nothing like the oil shock of 1973, which triggered a 40% fall in US stock markets from peak to trough.
Sarah Breeden, of the Bank of England, says she expects stock markets to fall at some point, as they do not fully reflect the many current risks to the global economy. But for now, stock markets seem to assume that peace will eventually prevail, and lots of big companies are continuing to make more money than investors were expecting.
But an energy shock is part of the Bank of England’s check list of risks which Breeden fears could hit simultaneously.
“What happens if a number of these risks crystallise at the same time?”, she asks. “Major macroeconomic shock, at the same time as confidence in private credit goes, at the same time as AI valuations and other risky asset valuations readjust. What happens in that environment and are we ready for it?”.
Artificial intelligence
And there Breeden hits on another risk to add to our potential crisis cocktail.
Over $2tn has poured into investments in AI, in what Microsoft co-founder Bill Gates has called “a frenzy” and others have described as a bubble.
It has propelled the valuations of a few mega companies to the point that 37% of the value of the main US stock market index, the S&P 500, is now concentrated in just seven companies (including Nvidia, Microsoft, Google parent company Alphabet and Amazon, which are also among the biggest spenders on AI infrastructure).
That means the millions of people who invest in index tracking funds are investing a large portion of their savings in AI, whether they want to or not.
A big sell-off in these companies would hit savers – including individuals and pension funds in the UK – and inevitably rock business and consumer confidence.
The bursting of the dotcom bubble, which peaked in March 2000, helped trigger a recession in 2001. The tech heavy NASDAQ index fell nearly 80% between March 2000 and October 2002, destroying billions in market value. That collapse of internet-based companies, massive investor losses, and widespread tech layoffs caused a broader downturn in the economy.
A financial fire
There’s also the question of how effectively policymakers could hose down a financial fire.
In 2008 governments eventually got a grip on the chaos by pumping billions of public money into major banks to prevent their collapse, and raising guarantees on bank deposits to prevent savers fleeing. At the same time, major central banks cut rates, including a rare coordinated rate cut in the autumn of that year.
But some worry that those options may no longer exist.
In 2008, UK government debt amounted to less than 50% of national income. Today that number is close to 100%, after major interventions in 2008 bailing out banks, wage support during Covid-19, and the energy subsidies in 2022 after Russia’s invasion of Ukraine. So, the government’s ability to borrow money is much more limited.
Mohammed El-Erian uses the analogy of a fire brigade that has run out of water. “Governments and central banks have had to respond to crisis after crisis and as they have done, they’ve run down the ability to respond,” he warns.
That sentiment is echoed by the International Monetary Fund (IMF), which said earlier this month that the world’s manifold economic challenges come at a time when “policy space has been eroded”.
There’s also the poor state of international relations. Amid the 2008 crisis, national leaders met at a series of emergency meetings, including a crucial one in Washington in November 2008, where they hammered out their plan to pour billions into banks; and another in London in April 2009.
Gordon Brown, the prime minister who helped to lead the international response, has said that strong international cooperation is what stopped the crisis from turning into a depression.
Image caption,Amid the 2008 crisis, national leaders met at a series of emergency meetings, including a crucial one in Washington in November 2008
All that could be more difficult today, amid significant disagreements between rich countries over trade policy, Nato, and even the status of Greenland.
Writing earlier this month about the dangers of a financial crisis, the IMF made a point of warning that “international cooperation is weaker” now than in previous years. The implication, perhaps, is that in an era of war in Europe, US-China trade wars, and US President Donald Trump’s “America First” policy, it will prove more difficult for governments to put aside their differences and get around a crisis table in the way they did in 2008.
And Brown has repeatedly warned of the dangers of an isolationist, ‘us versus them’ approach to international affairs.
Financial fragilities
Sarah Breeden, however, gives a note of optimism, arguing that banks have more capacity to absorb shocks than they did in 2008.
She takes comfort from the fact that banks are “much more capitalised now” – in other words, they have higher reserves of cash, rather than relying on borrowed money.
“I don’t think if we get stressed it will be on the same scale,” she says.
Mohammed El Erian agrees – to an extent. “We’re not exactly in 2008 territory because I do not believe that the banking system, and therefore depositors’ money and the payments system, is at risk. But we are in a 2008 moment in that the financial system could aggravate economic fragilities that tip us into recession.”
And if that does happen, he’s in no doubt who will suffer most.
“Economic and financial fragilities tend to expose the most vulnerable segments of the population. They have the least resilience and tend to get [hit] particularly hard.”
Image caption,Bobby Seagull is now a Maths teacher
Bobby Seagull, now a Maths teacher – says financial markets are even more complex now and you never quite know what nasty surprises are lurking under the surface.
“You’re sort of passing on financial instruments from one person to the other, not sure what’s inside it. And I think the worry is if things happen, they escalate very quickly in financial markets. And that’s where you don’t want to be the last person left holding that package.”
Only UKW (Greencoat UK Wind) has publicly available 2031–2032 dividend forecasts. For NESF, SEIT, FGEN, GCP, no public 2031–2032 forecasts exist — but we can derive credible forward estimates using their published dividend policies and the latest analyst projections.
Below is the clean, consolidated forecast table using the best available data from your search results.
(All figures per share, in pence. Forecasts are based on published dividend policies, inflation‑linkage rules, and available long‑range analyst projections.)
✅ 1. Greencoat UK Wind (UKW) — Only trust with explicit 2031–2032 forecasts
Source: Digrin long‑range dividend model.
2031:20.656p
2032:23.207p
These are based on UKW’s policy of RPI‑linked annual increases, which the trust has delivered for 12+ years.
🟧 2. NextEnergy Solar Fund (NESF)
Latest published projections extend only to 2028:
2026: 8.43p
2027: 8.56p
2028: 8.68p
NESF’s dividend growth trend is ~1.5% per year (inflation‑linked subsidies). Applying that forward:
Estimated (modelled)
2031: ≈ 9.07p
2032: ≈ 9.21p
🟧 3. SDCL Energy Efficiency Income Trust (SEIT)
Latest published projections extend to 2026:
2024: 6.24p
2025: 6.32p
2026: 6.75p
SEIT’s long‑term dividend growth trend is ~2% per year.
All yields use the latest live prices from search:
NESF: 46.30p
SEIT: 43.05p
UKW: 99.18p
FGEN: 73.80p
GCP: 74.40p
Dividend forecasts (from earlier modelling + UKW published long‑range model):
Trust
2031 Dividend
2032 Dividend
NESF
9.07p
9.21p
SEIT
7.45p
7.60p
UKW
20.656p
23.207p
FGEN
8.85p
9.10p
GCP
7.00p
7.00p
📊 Forward Yield Table (Based on Today’s Prices)
2031 Forward Yields
Trust
Price
2031 Div
2031 Yield
NESF
46.30p
9.07p
19.6%
SEIT
43.05p
7.45p
17.3%
UKW
99.18p
20.656p
20.8%
FGEN
73.80p
8.85p
12.0%
GCP
74.40p
7.00p
9.4%
2032 Forward Yields
Trust
Price
2032 Div
2032 Yield
NESF
46.30p
9.21p
19.9%
SEIT
43.05p
7.60p
17.7%
UKW
99.18p
23.207p
23.4%
FGEN
73.80p
9.10p
12.3%
GCP
74.40p
7.00p
9.4%
🏆 Yield Ranking (Highest → Lowest)
2031
UKW – 20.8%
NESF – 19.6%
SEIT – 17.3%
FGEN – 12.0%
GCP – 9.4%
2032
UKW – 23.4%
NESF – 19.9%
SEIT – 17.7%
FGEN – 12.3%
GCP – 9.4%
🔍 Interpretation
UKW dominates due to its RPI‑linked dividend policy and depressed share price.
NESF & SEIT deliver extremely high forward yields because prices are deeply discounted relative to inflation‑linked cashflows.
FGEN sits in the middle: stable, but not explosive.
GCP remains a flat 7p payer, so its yield is purely price‑driven.
Whilst there is likely to be lots of changes in the sector before the dates above but if the fcast is only partly correct, the long term outlook will be very interesting.
The 2032 fcast yield for UKW is 23.4p, a yield on the current buying price. would be 23.5%. IF that is only partly achieved the share price will not be 99p.
Here is the pure, maximum‑monthly‑income ETF basket built specifically for a UK investor, using only UCITS‑compliant, exchange‑listed, monthly‑paying ETFs.
🔥 The Pure Maximum‑Monthly‑Income ETF Basket (UCITS)
Objective: Maximise monthly cashflow, not long‑term growth Style: High‑yield bonds + global dividends + covered‑call income Currency: GBP‑accessible UCITS ETFs Distribution: Monthly (or effectively monthly via staggered holdings)
1) Global High‑Dividend Core (Monthly)
Purpose: Reliable, equity‑based income Yield Range: ~4.5%–6% Role: The “equity backbone” of the income stream
Examples of ETF types in this slot:
MSCI World High Dividend Yield UCITS ETFs
Global Select Dividend UCITS ETFs
These provide global diversification and stable dividend flow.
2) High‑Yield Bond Engine (Monthly)
Purpose: Maximise raw yield Yield Range: ~6%–9% Role: The “income engine” of the basket
These ETFs typically hold:
Global high‑yield corporate bonds
Short‑duration high‑yield bonds
EM government bonds (USD‑denominated)
They are the highest consistent monthly payers in the UCITS universe.
3) Covered‑Call Income Boosters (Monthly / Near‑Monthly)
Purpose: Generate option‑premium income Yield Range: ~8%–12% Role: The “turbocharger” of the basket
Covered‑call ETFs generate income by selling call options on equity indices. They sacrifice some upside for very high monthly distributions.
📦 The Basket Structure (Clean & Powerful)
A) 40% — Global High‑Dividend ETFs (Monthly)
Smooth, diversified income
Lower volatility than pure equities
Anchors the portfolio
B) 40% — High‑Yield Bond ETFs (Monthly)
Highest consistent monthly payouts
Strong income engine
More stable than equities
C) 20% — Covered‑Call ETFs (Monthly / Near‑Monthly)
Could value stocks offer the remedy to an AI bubble?
Thursday, May 7, 2026
Hannah Williford
Content Writer
Related news
The lofty valuations of AI stocks in the past few years have dredged up memories for some of the time before the dotcom bubble burst in 2000.
This burst, which led to steep fall in the MSCI World over a period of two years, was due to overinvestment in internet companies that eventually couldn’t live up to their value despite the internet becoming a part of everyday life. It’s simple to see the similarities to today: even with a general consensus that AI will be a world-changing technology, it’s hard to be clear on the companies which will benefit most.
But a striking phenomenon of the dotcom bubble bursting was the performance of value stocks in the aftermath, which shot up as the rest of the market fell. The past is never a perfect indicator of what will happen to markets in the future, but some investors believe value stocks could deliver the same bumper returns if the AI bubble burst.
Investors can see this through the Fama-French HML Factor Data. This is an educational data measure that shows how value-driven stocks perform in comparison to growth stocks. The chart below shows how dramatically value outperformed growth in the period immediately following the dot-com crash.
What does value really mean?
There is no single definition of what qualifies a stock as ‘value’. Generally, it refers to stocks that are unloved by the market, but if these stocks are worth more than their price will depend on who you ask. This makes it a popular area of the market for fund managers that select their own stocks, because it allows them to use their own strategies to see appeal they think others, or indices, might be missing.
Indices offer value options too, but their performance has differed widely based on criteria. The MSCI World Value index, for example, has lagged behind the standard MSCI World in the past five years, with returns of 65.8% and 76%, respectively. But the MSCI World Enhanced Value Index has beat both with a 101.65% return.
How are these value metrics so different? MSCI World Value Index chooses its holdings based on book value (essentially the value of a company’s assets) divided by share price, dividend yields, and 12-month forward earnings multiples. It then gets a score to sort it between value and growth. But a stock can fall in both of these baskets which means the returns of this index aren’t always so different from the broader market.
MSCI World Enhanced Value, on the other hand, uses different metrics, has stricter criteria, and an all-in or all- out approach for if stocks qualify. This creates a smaller qualifying group and a much different return than the standard MSCI World.
This stricter criteria meant that on a longer- term view, including in the early 2000s, the enhanced value strategy won out. However, in times that were strong for growth, such as the 2010s, this index lagged behind.
Balancing growth and value
Value stocks don’t come without risk, and some are cheap for a reason. By relying them on completely, investors would likely have missed out on some of the most impressive market performers in recent years, such as Nvidia and Alphabet. For this reason, many investors choose to use a blend. Indices like the MSCI World are, by nature, weighted more heavily towards growth. So having a separate portfolio weighting that is aimed specifically at value can be a way to even out this risk.
Some value stocks will present a smoother ride than broader equity markets, as many measures of value include stocks that pay high levels of dividends, which tend to be more mature businesses. But other value stocks are discounted severely because the company has had a difficult period. This does involve risk, but it can still be a diversifier to other parts of your portfolio.
Value investments can be hard to sniff out, because it involves deep analysis of why they are trading more cheaply in the first place, as well as what their potential is for the future. There’s always a possibility of buying a stock that looks good value at the time, but keeps sinking instead of recovering. Some prefer to leave it up to the experts and invest through funds. The table shows the best performing value funds of the past 10 years offered on AJ Bell’s platform. Note that these funds will each have different metrics to constitute value, and past returns don’t guarantee future performance.
Appointment of Investment Manager and Company Secretary
The Board of Murray Income Trust PLC (the “Company”) is pleased to announce that, further to its previous announcements, it has entered into an investment management agreement with Artemis Fund Managers Limited (“Artemis”) as the Company’s new alternative investment fund manager, which has become effective today. The investment management agreement reflects the heads of terms announced on 20 November 2025.
Looking at the performance table above, Artemis have been appointed managers of MUT. The yield is only 4% so you would have to split your investment and pair trade it with a higher yielder to maintain a blended yield of 7%. General advice not trading advice.
