View the article online at http://citywire.co.uk/wealth-manager/article/a385052
Newton Global Higher Income
by Nisha Long on Nov 04, 2013 at 14:38
Harries told Citywire Selection: ‘We are not willing to embrace risk in the marketplace like some of our peers and will not keep up with racier markets. Quantitative easing has pushed up asset prices artificially and this makes it a very dangerous environment to be in.’
Instead, the manager prefers to concentrate on long-term themes and remains cautious.
Harries seeks out companies that are not dependent on the economic cycle and have stable growth, sustainable dividends and predictable cashflow. He is particularly bullish on healthcare, consumer staples and telecommunications, which he believes fulfil these criteria.
Harries also recently bought into Microsoft, which he regards as inexpensive and offering a healthy yield.
‘Return on capital continues to be fantastic and [it] has an attractive dividend yield. Its free cashflow keeps increasing and has doubled in the past 10 years,’
The stock also fulfils his strict yield discipline. Harries has a remit of only buying companies yielding 25% more than the FTSE World benchmark.
‘Our yield discipline will take us out of a stock if it becomes too expensive and with this in mind we have recently sold our positions in DNB Bank and AT&T. Both these stocks have become fully valued and our yield discipline kicked in so it was time to sell out.’
News sponsored by:
Ian McVeigh and Steve Davies, managers of Jupiter's UK Growth fund, talk about their predictions for the UK equity space. Click here to watch a series of sponsored interviews with Jupiter's fund managers on the UK equity market.
Today's top headlines
More about this:
Look up the funds
Look up the shares
- Vodafone Group PLC (VOD)
- Centrica PLC (CNA.L)
- Scottish and Southern Energy PLC (SSE.L)
- HSBC Holdings PLC (HSBA.L)
- Standard Chartered PLC (STAN.L)
- BP PLC (BP.L)
- GlaxoSmithKline PLC (GSK.L)