The potential for permanent loss from equities means that an investor nearing retirement shouldn’t have all their eggs in the equity income basket; however, equities offer a very effective way to diversify your income stream away from low-yielding cash and bonds and give you the potential for capital appreciation as a bonus.
The compounding effect of dividends on total return makes equity income a good longer-term option as well. The improving dividend culture of corporate sectors and regions – including emerging markets – has made the total return potential of equity income funds even more attractive.
But what’s your perfect fit?
To find out which equity income fund is right for you, download the latest edition of FE Investazine here.
