A NEW ERA FOR INCOME STRATEGIES
Income investing has moved into a new dimension. In the past, income-generating strategies were largely restricted to cash and fixed income so that, to a large extent, investors had to accept the need to sacrifice the opportunity for capital growth in order to obtain a higher yield.
Times have changed and now, an income strategy does not necessarily mean you have to accept a hit to your portfolio’s value – especially if you are in a position to take on a bit more risk with your capital.
There are plenty of choices of all persuasions available to income-seeking investors and this guide sets out a number of the available options.
FLEXIBILITY AND VERSATILITY
For many investors, an income-generating strategy forms the core of their approach. Some want a portfolio that will provide a regular income stream for them to spend. For others, an income-based approach is a consequence of their attitude to risk, rather than an instigator of their strategy, and these investors might choose to reinvest their income to boost their portfolio’s total return over the long term.
Still others might have a core investment strategy that focuses on capital growth, complemented and diversified by an income-generating segment.
Every investor will have their own unique needs – for instance, they might choose to draw the income or to reinvest it for the long term. However, an income strategy can easily be adapted to meet each investor’s changing circumstances as time moves on.
A WORLD OF CHOICE
Whatever your investment risk profile, there are a wide range of asset classes from which to formulate a diversified income strategy – from government and corporate bonds, through UK and global equities to property.
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