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Sanlam cuts Barnett & Artemis pair in major income overhaul
by Dylan Lobo on Jan 27, 2014 at 07:51
The Sanlam Income Study has relegated Neil Woodford’s heir Mark Barnett, and the Artemis team of Adrian Frost and Adrian Gosden from its White List.
Sanlam, which slapped a sell rating on Woodford’s funds at the start of 2013, has demoted Barnett’s Invesco Perpetual UK Strategic Income fund to its Grey List on the view that his hands will be full when he takes sole control of the firm’s flagship income later this year on Woodford’s departure.
‘Mark Barnett (pictured) will see his workload increase significantly from April this year,’ the study’s author and former Wealth Manager cover star Paul Surguy said.
‘This vehicle, which he has managed for many years, has outperformed Neil Woodford’s current offering over the past five years, albeit for a small increase in the level of risk.’
Meanwhile Frost and Gosden’s Artemis Income fund, has paid for a period of poor performance. ‘It is with heavy hearts that we initiate a sell on Artemis Income,’ Surguy said. ‘We have long been supporters of Adrian Frost and Gosden and they have regularly featured in client portfolios.
‘However, our job on the Income Study is to remain unemotional and allow the process to speak for itself. Due to unexceptional returns over the last five years, the fund is falling down the Grey List and investors should therefore consider alternatives.’
The two funds are among six to lose their places on the White List in the biggest shake-up in years.
The study ranks income, total return and volatility of funds in the equity income sector over the last five years. With the Lehmans crisis of 2008 now erased from the review period, returns have been dominated by those funds which have tended to exploit outperformance by smaller and medium-sized companies.
Other funds chopped from the White List include Michael Clarke's Fidelity Moneybuilder Dividend fund, the RBS Equity Income fund along with Chris Murphy’s Aviva Investors UK Equity Income fund and Francis Brooke’s Trojan Income fund.
However, Surguy does not see the Aviva and Trojan funds as outright sells and maintains hold ratings on both. Surguy said: ‘Chris Murphy on Aviva Investors UK Equity Income has been heralded a safe pair of hands by us over many years. As we look at the numbers he has produced, these have been consistently solid, as has income generation. We will overlook this short-term drop into the Grey List for the time being.’
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Look up the funds
- Invesco Perpetual UK Strategic Inc (No Trail) Inc
- Artemis Income R Inc
- Fidelity MoneyBuilder Dividend
- Aviva Investors UK Equity Income SC 1
- Trojan Income O Acc
- M&G Dividend A Inc
- Rathbone Income Inc
- Premier Inc A Net Inc
- AXA Framlington Monthly Income R Inc
- Liontrust Macro Equity Income Fund - Acc (R)
- Old Mutual UK Equity Income A Acc
- SWIP UK Income B Acc
- Jupiter Income Trust
- Newton Higher Income GBP Inc
- M&G Dividend A Inc
Look up the fund managers
- Mark Barnett
- Adrian Frost
- Adrian Gosden
- Michael Clark
- Christopher Murphy
- Francis Brooke
- Thomas Moore
- Carl Stick
- Stephen Message