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Investment trusts are still income champions

Investment companies offer dividends and diversified plays on recovery themes.
Investment trusts are still income champions
  • Closed-ended funds are still ranking highly on our screen
  • Across all sectors, 15 FTSE All Share companies pass at least 7/8 tests

One of the striking features about our Alpha dividend yield screen is the prominence of investment companies among the top-ranking quality income shares flagged. 

One of the top companies this month is Apax Global Alpha (APAX) which is a private equity focussed trust. Shares trade at a premium to net asset value (NAV) but this is not unusual for a company that invests in a sector with huge expectations for growth. Certainly there is appetite for the asset class right now in anticipation of economies opening up again. 

Real estate investment trusts (REITS) also feature, with German residential property specialist Sirius Real Estate (SRE) and Impact Healthcare REIT (IHR) also ranking well. 

In terms of other companies, spread bet and trading firm CMC Markets (CMCX) has an attractive yield, but future earnings growth expectations need to be watched carefully. 

Another company that has done well is precious metals miner Polymetal International (POLY) which still passes all our tests. Gold didn’t take off as you might have expected with inflationary fears, but an income paying stock like this seems a sensible way to have some exposure. 

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