Henderson High Income Trust plc aims for sustainable high income with prospects for long-term growth. It invests in a diversified portfolio of both well-known and smaller companies and fixed interest.
Key Facts
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History of success
Launched in 1989, it is now one of the largest trusts in the UK High Income sector.
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Experience counts
Alex Crooke is a highly experienced investment professional who has managed Henderson High Income Trust since 1997.
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Focus on value
Alex looks for companies with strong free cashflow, that also meet three key criteria:
> under-owned (that is, currently out of favour with investors)
> under-followed (less research carried out by brokers and analysts, which can help us to uncover opportunities ahead of the market)
> under-valued (with the potential for a significant rise in the share price).
The Trust also has the flexibility to vary its approach if conditions change.
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Best of both worlds
Henderson High Income Trust holds around 25% of the portfolio in fixed interest securities (bonds); these offer regular income with lower volatility than shares.
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Specialist insightThe fixed interest element of the portfolio is managed by John Pattullo, an expert fixed income fund manager.
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Regular incomeThe investment trust pays quarterly dividends, which can be used as regular income or reinvested.
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Reasons to Invest
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Strong performanceHenderson High Income Trust plc is one of the best-performing trusts in the UK High Income sector over five years (Source: The AIC/FundData 18/08/09).
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High yieldThe company focuses on delivering a high yield for investors and is currently above the sector average (Source: The AIC/FundData 18/08/09).
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Motivated to achieve
A performance fee closely aligns the interest of the manager with those of the shareholders.
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Value for moneyThe trust has one of the lowest Total Expense Ratio (TER) in its peers of 1.05% (Source: The AIC/FundData 18/08/09)
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Price
| Price | NAV
05/02
2010 | Div Yield
(Net) | Discount |
|---|
| 110.8 | 112.2 | 7.5 | -1.41 |
As at
08/02/2010
Source: Financial Express
Fund Manager's Commentary - December 2009
The final month of the year saw the UK equity market making a new high for the year as a whole, capping a strong rally from the lows in March. The final rally in December was broad based as defensive sectors like tobacco and utilities outperformed, as did more cyclical sectors (those that move in line with the economic cycle) such as retailers and industrials. Retail sales were buoyant into Christmas, comfortably eclipsing the previous year and giving support to the sector.
Financials in general had a poor month, reflecting rising gilt yields and poor international sentiment surrounding the increasing public spending deficit. A limited pre-budget report gave away little with regard to future spending cuts, only highlighting the scale of future gilt sales to fund current spending plans.
We have maintained gearing during the fourth quarter of 2009 through increased exposure to pharmaceuticals; we feel the sector offers cheap valuations, significant overseas earnings and attractive dividend yields.