UK Equity Income yields
In July 2010 IMA combined the UK Equity Income and UK Equity Income and Growth sectors into the UK Equity Income sector and revised the sector definition. We also decided to publish the annual yield figures achieved by funds in the sector and these are shown in the yield spreadsheet.
The sector definition is:
UK Equity Income
Funds which invest at least 80% in UK equities and which intend to achieve a historic yield on the distributable income in excess of 110% of the FTSE All Share yield at the fund's year end.
Note:
- To ensure compliance with the sector criteria, funds should supply data for monitoring to enable the calculation of historic yield based on the IMA guidelines set out in "Yield Calculation and Disclosure by UK Authorised Funds - Guidelines for Managers September 2007".
- Funds are required to submit yield data at the fund’s year end to the sector team at IMA, and at the mid-year when notified by IMA.
- To ensure compliance with the intended 110% yield, funds in the sector will be tested over 3 year rolling periods by taking a simple average of the yield figure achieved for each fund at its year end. Funds that fail to meet the 110% average yield for each 3 year rolling period will be removed from the sector. (As an illustration, this would require a fund that delivered 90% in the first year and 100% in the second year to deliver a yield of 140% in the third year, if it were to be allowed to remain in the sector.)
- Annually, at the fund’s year-end, each fund in the sector must achieve a yield of not less than 90% of the FTSE All Share yield. Funds that fail to do so will be removed from the sector.
- IMA will measure yield to one decimal place.
- IMA will consider adjusting the yield parameters of the sector up or down to account for extraordinary market factors when a request is made by funds in the sector representing either 50% by number or 80% by value.
- To assist users of the sectors and aid comparison, IMA will publish the annual yield achieved by each fund in the sector.