M&G Global Dividend seeks total return

But yield is still important and the fund has one of the highest in its sector, 3.8 per cent, though not as high as some of its global income peers. But it is well ahead of most of these in terms of total returns, and one of the best performing funds in this sector over one year. The fund is a relatively recent launch, however, so it remains to be seen if it can keep this up.

"Although the M&G Global Dividend fund has a short investment history we believe that the fund's simple investment strategy is very compelling and M&G has a long history of delivering good long-term returns in many of their investment funds," says Sheridan Admans, investment adviser at The Share Centre, which includes the fund on its Platinum 120 list - the funds its advice team believe have the best long-term prospects and strong management.

M&G Global Dividend Fund aims for a dividend yield above the market average and to grow its income stream over the long-term. The fund's manager, Stuart Rhodes, picks stocks via a bottom-up basis seeking companies which have the capital discipline to increase their dividends. He aims to hold around 50 stocks with a long-term investment view and a typical holding period of three years.

The fund does not have any constraints in terms of company sector or size, and selects stocks from three categories: companies with sustainable returns on capital which are under-appreciated by the market; companies where restructuring is improving returns; and companies whose assets are boosted by a step up in returns due to external changes.

Source: Morningstar, *M&G.

Performance data as at 3 September 2010.

Top 10 holdings as at 31 July 2010

Sector Breakdown as at 31 July 2010