The fund will aim to give investors access to a high and regular income stream, alongside potential capital growth through exposure to global property securities.
The team will target a yield of 7 per cent, using an actively managed portfolio of higher-yielding global property securities and real estate investment trusts (REITs), with a covered call option overlay to enhance the yield. Thomas See, head of structured fund management at Schroders will co-manage the fund, alongside fund manager of Schroder Global Property Securities Jim Rehlaender and US REITs specialist Al Otero.
The income strategy is similar to that of the successful Schroder Income Maximiser and Asian Income Maximiser funds. The new fund will follow a similar stock selection strategy to Rehlaender’s Global Property Securities fund and there is likely to be a significant degree of commonality in stock positions. Financial Express data shows that Global Property Securities has outperformed its IMA Property sector by more than 30 per cent in the last five years.
However, Global Property Income Maximiser is likely to have greater exposure to securities that are particularly suited to income generation through dividends and call option writing.
Though the Property sector has had a tough time of late, multi-asset manager at OPM Tony Yousefian believes that the launch is well timed.
He said: “As long as the managers are very selective with their asset allocation, I think the team can do very well. Some may argue that those investing in the property market have already missed the boat, but I still think there is a reasonable mileage in this sector, especially as REIT managers can be much more aggressive.”
“The UK market is limited, but there are certainly hot spots globally; for example, the Far East and Hong Kong have been on fire of late.” Thomas See added: “For an investor able to accept the inherent risk in an equity investment, the Maximiser strategy has the advantage of drawing from two sources of yield; stock dividends and call option premia.”
“These are both independent of low interest rates, which are currently depressing investment returns and making it hard for investors to find yield.”