Bargain basement income, growth at a discount, good value in Japan and following commodities closely

Low interest rates and bond yields have pushed desperate investors into equity income, driving up the prices of these kinds of shares. But if you look in the right places you can find income shares on valuations not seen for 30 years, argues Gervais Williams, manager of Diverse Income Trust (DIVI). He tells deputy personal finance editor Kate Beioley where he is finding such shares, why they are so cheap and why they should outperform in the coming years – even with problems like Brexit on the horizon.


This week's tip highlights an investment trust focused on some of the same areas as Diverse Income Trust but which looks to exploit their growth rather than their income. This trust has performed strongly since its current manager has been running it, and at the moment it can be picked up at a wider discount to net asset value than some of its peers.

Markets such as the US arguably cost an arm and a leg, so if you want developed markets exposure at a more reasonable price Japan might be better, reports personal finance writer Emma Agyemang. She explains why there a number factors which mean Japanese equities might do well in the years ahead and highlights the funds which look best placed to reap the potential rewards of this market. She also points out some less attractive attributes you need to be aware of before deciding whether to jump in.

A problem with investing in commodities is that the funds tracking them often don't deliver similar returns to the spot prices of these assets, but a new exchange traded fund (ETF) is aiming to replicate the returns of spot prices more closely. Kate Beioley explains how it will work and why it might do better than existing ETFs.

The financial regulator has issued a report calling for asset managers to radically overhaul the way they charge investors for their funds. Kate Beioley finds out what the regulator says is wrong with the way asset managers charge investors and how it plans to remedy this. She also asks market participants if this is the right approach.

The readers featured in this week's Portfolio Clinic also need to have a think about how much they are paying for funds according to our commentators, who suggest some ways to cut their overall fund costs. They also explain how our readers can improve the income from their portfolio.

In our latest podcast the team are joined by Ryan Hughes, head of fund selection at AJ Bell, to consider the implications of including domestic Chinese A shares in MSCI Emerging Markets index. They also highlight a hefty cost behind the charges on passive funds, what has been performing well since the vote for Brexit and what might deliver good returns going ahead.

Our podcast is now available across five different distribution channels to allow you to access it in the most convenient way. Find us on Soundcloud, Acast, Audioboom, Stitcher and iTunes.

Do you have a personal finance problem? Or want to know more about something in this week's personal finance pages? If so let us know by getting in touch with leonora.walters@ft.com, kate.beioley@ft.com or emma.agyemang@ft.com.

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