Join in the staycation

01 July 2021

4 minute read

We take a look at three UK funds; Artemis Income, Lindsell Train UK Equity and Jupiter UK Mid Cap.

Who's it for? All investors

The value of investments can fall as well as rise and you could get back less than you invest. If you’re not sure about investing, seek professional independent advice.

While travelling abroad is not an option for all this year, many families are taking their annual summer holiday in the UK.

Hotels, B&Bs, self-catering holiday homes and campsites have all seen a surge in bookings for 2021 as people race to secure a well-deserved break within driving distance.

The UK has much more to offer than just a great place to enjoy on a holiday.

Even though investing in the UK has been out of favour with investors and Brexit continues to present challenges for many businesses that have also been suffering during the pandemic, many believe that Britain still houses some of the best companies in the world.

So for those investors who want to back a strong recovery for home-grown businesses in the long term, here are three UK funds to consider for your ISA or pension.

Artemis Income

Income seekers are struggling to find decent returns from cash savings or assets such as bonds. For those willing to accept higher risk and invest their money, equity income funds can offer attractive levels of income, as well as scope for capital appreciation if the stock market rises. An equity income fund manager will choose established, cash generating companies that they believe will grow their dividends over time.

The income can be paid out directly to an investor, or alternatively it can be reinvested in the fund.

We believe the Artemis Income fund is one of the stalwarts of the UK Equity Income market. The fund managers – there are three – look for companies with strong balance sheets, sustainable cash flows and attractive valuations and that are best placed to grow their dividends, while also delivering capital growth for shareholders.

The fund mainly invests in UK companies, but it does have the flexibility to invest overseas when attractive opportunities arise. Its holdings tend to be stable, well-established businesses with the financial strength to pay solid dividends to their shareholders.

Lindsell Train UK Equity

High quality companies with durable business models and strong brands, that produce high levels of cash flow are the features of companies held in the Lindsell Train UK equity fund.

Many of them are household names including Unilever, the consumer giant behind brands like Marmite, Dove Soap and Magnum ice cream. It also owns Diageo, the global drinks company that houses names including Johnnie Walker whisky and Smirnoff vodka. A new addition at the end of last year was PZ Cussons, which is the parent group of Carex and St Tropez tanning lotions. This was the first new stake in a UK-listed company in nine years to join a small portfolio of UK companies of around only 25 holdings. The style of the manager, Nick Train, is to hold onto what he refers to as “exceptional companies” for the very long term.

The distinct and robust investment process that sits behind every single investment is the same process that’s been followed for nearly 20 years - which is why we like it as we have confidence about what to expect from this fund in the years ahead.

Jupiter UK Mid Cap

Medium-sized companies are capable of paying attractive returns - many have an excellent track record of paying decent incomes.

Like small companies, medium-sized companies have the potential to grow faster and further than larger firms, providing the potential benefit of capital growth as well as income. However, this isn’t guaranteed and there is also the potential for greater volatility and falls in value.

The Jupiter UK Mid Cap fund aims to take advantage of the opportunity to access faster growth, by investing in a range of medium sized UK companies. The manager and research team behind the fund look for promising opportunities in companies where the share price looks cheap given the future growth outlook.

We like this fund’s proven track record in this market.

Don’t avoid global opportunities

Investing in British business should not be the only region that appears in your portfolio. It does not make sense to concentrate or make all your investments in a particular region - a well-balanced portfolio should also have overseas exposure.

Adding funds from other regions helps to build a globally diversified approach so you may wish to consider other funds on the Barclays Funds List, where you can find many other options. Find out more information about all of these funds.

Map your route to a balanced portfolio

To avoid having to choose the correct blend of regions for your portfolio, it’s worth considering an investment that contains a diversified range of funds which invest across multiple regions, markets and types of assets.

The Barclays Ready-made Investments (RMI). is just one example of a range of diversified funds which allow you to select the level of risk you are most comfortable with. These multi-asset funds invest in passive funds across a range of asset classes and regions, offering a globally diversified one-stop solution for investors. Ready-made Investments are not the only funds that we offer and they won’t be appropriate for everyone.

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The value of investments can fall as well as rise. You may get back less than you invest. Tax rules can change and their effects on you will depend on your individual circumstances.

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