The Income and High Income funds are being taken over by FE Alpha Manager Mark Barnett, who already has a high profile thanks to the outstanding performance of Invesco Perpetual UK Strategic Income.
However, Ciaran Mallon, who has taken over the equity sleeve of the Invesco Perpetual Distribution and Invesco Perpetual Monthly Income Plus funds is less well known.
Our data shows that he has a strong track record of outperforming his peers, but not to the extent that Woodford and Barnett have.
His Invesco Perpetual Income & Growth fund has made 82.15 per cent since he took over in 2005 while the average fund in the sector has made 75.64 per cent. Woodford’s funds have returned more than 115 per cent.
Performance of funds vs sector since July 2005
Source: FE Analytics
As much as 80 per cent of the £3.8bn Invesco Perpetual Monthly Income fund is under the control of the bond managers Paul Read and Paul Causer, and they are likely to continue to drive returns. The fund has five FE Crowns.
Advisers say that investors have no need to panic and should wait and see how things turn out. Nevertheless, it is certainly a reasonable time to assess the other funds out there with a similar profile.
Here we look at the top-rated funds that pay out a monthly income from bonds and equities.
Fidelity Moneybuilder Balanced
Fidelity Moneybuilder Balanced is one of only two funds to pay out monthly that has an FE Alpha Manager – Ian Spreadbury – and five FE Crowns.
Spreadbury runs the bond side of the £320m portfolio, which sits in the IMA Mixed Investment 40%-85% Shares sector, while Michael Clark handles equities.
The fund is a top-decile performer over three and five years, having outperformed the Invesco fund over three.
Performance of funds vs sectors over 3yrs
Source: FE Analytics
Over 10 years its total return of 126.32 per cent is close to the 123.22 per cent made by the Invesco fund.
It is not a clear alternative, however, because of its different weighting to equities. Shares make up roughly 65 per cent of the portfolio.
Another issue is that the fund has had a difficult 12 months, slipping into the fourth quartile of its sector. The returns of 12.74 per cent still compare favourably to the 11.26 per cent of the Invesco fund, however.
Over the past 12 months it has paid out 4.28 per cent, close to the 4.62 per cent of Invesco Perpetual Monthly Income Plus.
The fund requires a minimum initial investment of £500 and has ongoing charges of 1.21 per cent.
Jupiter Monthly Income
Jupiter Monthly Income is the only other fund that pays out monthly to boast an FE Alpha Manager and five FE Crowns.
The bond side of the £88m portfolio has been run by FE Alpha Manager Ariel Bezalel, who also handles Jupiter Strategic Bond, since March 2011. Equities have been in the charge of Richard Curling since January 2012.
Over the past three years it has made 36.72 per cent, significantly ahead of the average returns of the IMA UK Equity & Bond Income sector.
Performance of fund vs sector over 3yrs
Source: FE Analytics
It is a very different proposition to the Invesco fund, however, with just 15 per cent in fixed interest, while the equities component is made up of investment trusts.
European Assets, Investors Capital and Schroder Oriental Income are the top-three holdings.
Ongoing charges are 1.72 per cent and the fund requires a minimum initial investment of £500.
Premier Multi Asset Monthly Income
The £50m Premier Multi Asset Monthly Income fund has been one of the standout performers in the IMA Mixed Investment 20%-60% Shares sector over the past three years.
Our data shows it has returned 31.35 per cent over this time, the fourth-best figure in the sector. It has produced the eighth-best gains over one year, too.
Over the past 12 months it has distributed 4.47 per cent as income.
The fund has five FE Crowns and is headed up by a team under David Hambidge, head of multi-manager at the firm.
The fund is more diversified than the others on this list, with 12 per cent in property and 6.8 per cent in alternatives. The latter includes infrastructure trust International Public Partnerships and the Real Estate Credit Investments trust.
Ongoing charges are 2.34 per cent and the minimum initial investment is £1,000.
Threadneedle Managed Income / Threadneedle Monthly Extra Income
Both these funds have five FE Crowns and are run by Richard Colwell, with the Threadneedle Monthly Extra Income fund enjoying the contribution of Alasdair Ross.
Both aim to invest at least two thirds of their assets in funds, including both equity and bond portfolios.
The Monthly Extra Income fund is top in its IMA UK Equity & Bond Income sector over five years and the Managed Income fund third.
Over three years the funds are first and third respectively and are first and second over one year.
Performance of funds vs sector over 3yrs
Source: FE Analytics
The yield on the funds has fallen slightly short of the others on this list however, with the Monthly Extra Income fund paying out 3.56 per cent over the last year and the Managed Income fund 3.67 per cent.
Threadneedle Managed Income is slightly more expensive, with ongoing charges of 1.8 per cent; Threadneedle Monthly Extra Income charges 1.39 per cent. Both require a minimum initial investment of £2,000.