HC Charteris Premium
The fund seeks to provide income and capital growth from a portfolio predominantly invested in liquid UK quoted equities. At its core, the fund’s strategy starts with the analysis of global macro- economic trends and themes. Individual stocks are then selected based on how they may benefit from those global trends. The fund has a target dividend yield of 4-6 per cent but stock selection is not dictated by yield and the fund may at times invest in companies that don’t pay dividends. Income is managed at a fund level with individual stock decisions being driven by the underlying attributes of each business and its return potential. From time-to-time, and if required, the manager will use covered call options for short periods but only to boost the fund’s overall dividend income.
Who Might The Fund Appeal To?
Investors looking for income, but not at the expense of capital growth.
Top-quartile performance in 2007, 2009, 2010 & 2016 and over the past 12 months in the IA Equity Income Sector*
Outperformed UK Equity Income Sector by 9.28% in 2016*
Morningstar 1 Star Rating, FE 1 Crown Rating
Source: * Financial Express
The holdings in the portfolio are selected by a combination of top‐down thematic strategy and bottom‐up stock selection. Technical analysis is used extensively to help time investment decisions including the writing of covered call options
Options are only written during periods of the year when certain technical and fundamental investment criteria are met. Many similar option funds continuously run the risk of missing out on strongly rising markets
Stock selection is not limited to high yielding stocks and
the uncertainty as to whether the dividend will be maintained. The three month option premium on higher volatility shares can exceed the annual dividend yield on high income low volatility shares
Investment aims and Structure
This is a UK UCITS Fund which invests in a selection of leading UK blue chip equities through a combination of active stock selection and the tactical writing of covered call options. The option writing is designed to increase the distributable income paid to investors by the fund
Aims to boost the income from a portfolio of leading UK Blue Chip Equities enabling investors to benefit from higher income while not necessarily missing out on capital gains
Targets growth stocks rather than traditional income stocks, which tend to underperform
Income boosted as the premium generated from the writing of call options are added to the dividends
As dividends can be cut the option proceeds are arguably a more reliable source of income
The Fund is only invested in UK Shares. By only writing options for four to five months a year, it is possible to significantly boost the income while retaining exposure to the equity market for the majority of the year.
Risk & Reward Profile
* Invests only in UK leading Blue Chip equities (or cash up to 20%) with a target dividend yield of 4-6%.
*Targets growth stocks rather than traditional income stocks, which tend of underperform.
*Seeks to boost dividend income by writing covered call options but only 4-5 months in a calendar year, leaving the Fund unencumbered by options for 7-8 months and free to make potential capital gains.
Charteris Treasury Portfolio Managers Ltd was established in 1984 as an investment management company. Charteris is authorised and regulated by the Financial Conduct Authority (FCA number 114952)
The investment team has more than 200 years of experience of global financial markets.
Past performance should not be as guide to future performance. All performance information is based on the Institutional Accumulation class unless stated otherwise. The value of this investment and the income from it can go down as well as up, it may be affected by exchange rate variations, and you may not get back the amount invested. The outlook expressed in this brochure represents the views of the Investment Manager at the time of preparation and should not be interpreted as investment advice. The asset split detailed within the brochure are correct as at reporting period and are subject to change, whilst operating within the objectives of the Fund. This document should be read in conjunction with the Fund’s Key Investor Information document (KIID), which will exclusively form the basis of any application and the Fund’s prospectus. A comprehensive list of risk factors is detailed in the KIID and the Principal Prospectus and an investment should not be contemplated until the risks are fully considered and understood. Current tax levels and reliefs will depend on your individual circumstances and
details are also contained in the Key features (including the KIID and Principal Prospectus). If you are unsure of the suitability of this investment, please contact your Financial Adviser (if applicable). This brochure is issued by Charteris Treasury Portfolio Managers Ltd. The KIID and Prospectus are available from the ACD DMS Host Capital Ltd at