A fully flexible way to invest
3 minute read
There’s a lot more to dividend investing than the UK market. By looking beyond our shores, investors open up opportunities in sectors and markets that can help build a diversified approach. And taking a global approach means searching out specialist fund managers.
Who's it for? All investors
With returns on cash savings tough to find, investors willing to accept higher risks have looked to investing in the shares of companies that pay dividends. Not only can these companies offer attractive yields, they also have scope for capital appreciation if the stock market rises. But while equity income funds are certainly worth considering for income seekers, it’s important to tread carefully. Here, we look at why dividend investors may benefit from taking a global approach to investing.
The first port of call for dividend investors is the UK stock market. Dividends are an established part of the UK market, such that it is one of the highest dividend-paying markets in the world. In addition, investors might feel safer sticking to their home market – after all, you’re more likely to be familiar with companies based on British soil rather than those based overseas. But there are many reasons to consider looking further than the UK and taking a global approach to investing in companies paying dividends.
Going global can help with diversification. By investing across numerous stock markets around the world, it can potentially help minimise the impact of stock market shocks on a portfolio. For example, if one region or sector suffers a knock, hopefully gains elsewhere will help offset these losses.
Another advantage of going global is that it gives you exposure to a wider variety of companies. Limiting your investment to the UK can mean missing out on some interesting opportunities. For example, technology companies tend to be under-represented in the UK. Most of the biggest technology companies, for example, have their headquarters in the US, whilst Japan is home to many companies at the forefront of high-tech manufacturing. In contrast, the UK’s FTSE 100 index of Britain’s biggest companies is heavily weighted towards oil and gas, and financials.
We understand that when it comes to investing, often the hardest part is knowing where to start. Buying a fund allows you to spread your money across a number of investments and you don’t have to buy and sell individual shares yourself, but you still need to decide which fund and manager to invest in.
With a Multi-Manager fund your investment is spread across several different managers who will normally invest with different approaches. They can be a convenient solution if you’re less sure about making your own investment decisions, or are short on time.
Barclays offer a range of Multi-Manager funds and we take the work out of investing because they’re looked after by Barclays’ investment experts who do all of the hard stuff so you don't have to. Instead of the manager of the Barclays Multi-Manager funds choosing individual shares and bonds to invest in themselves – their job is to choose other world-leading, specialist fund managers to look after parts of the fund.
There are three managers within the GlobalAccess Global Equity Income Fund: Artemis, Baillie Gifford, and KBI. Each are experts in investing in these specialist markets, but will do it in quite different ways. By investing in three very different managers together, the aim is to deliver more consistent performance as, when one underperforms, the other managers have the potential to deliver outperformance. Over the long term, we believe this approach has the ability to outperform.
The Barclays GlobalAccess Global Equity Income Fund is a fund worth considering if you’re thinking of taking a diversified approach to investing in the shares of companies paying dividends. This fund is one of 13 Multi-Manager funds on the Barclays Funds List. Find out more information about the Multi-Manager funds as well as other funds that invest in companies paying high dividends. Find out more information on these funds.
Correct at the time of publishing.
To diversify your investment, you may like to consider our own Barclays Ready-made Investments (RMI). The RMI are just one example of a range of diversified funds which allow you to select the level of risk you are most comfortable with. These Barclays multi-asset funds invest in passive funds across a range of asset classes and regions, offering a globally diversified solution for investors. Ready-made Investments are not the only funds that we offer and they won’t be appropriate for everyone.
Past performance of the fund and its manager are not a reliable indicator of their future performance.
We don’t offer personal investment advice so if you’re unsure you should seek that independently.
Funds are designed for the long term so you should only consider them if you can stay invested for at least five years.
These are our current opinions but the future, as ever, is uncertain and outcomes may differ.
Read the Assessment of Value report [PDF, 3.2MB] for funds run by Barclays.
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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