Income – Deriving Income from a Multi-Asset Portfolio

The Harvest Income Strategy aims to deliver income to investors from a broad range of asset classes.  The Strategy offers global exposure to equities, bonds and infrastructure combining the ability to trade freely with the availability of a reliable stream of income.

By diversifying across a range of asset classes, the strategy aims to lessen the impact of investment cycles on asset values to the extent that the different assets will not show a high degree of correlation.

The strategy involves taking an equal position across the four recommended funds. By doing so, the investors achieve exposure to total assets in the region of €36 billion as well as gaining a combination of equity, bond and infrastructure exposure.

The average distribution yield from these funds is expected to be in excess of 5% initially and should grow over time. In addition, the inbuilt asset diversification should result in lower than average volatility during difficult stock market phases.

How the Funds were selected

Our Investment Department surveyed more than 300 funds across different international markets and, based on the criteria listed below, selected three property related funds.

Criteria for Selection for Income Strategy

1. Daily Liquidity
2. Income Distribution of at least 3% per annum
3. No Material Gearing within Fund
4. Volatility below average of Comparable Funds
5. Track Record of three years minimum
6. Funds supported by broad international expertise
7. Mainly Euro denominated
8. Exposure to Equities (Global and European), Bonds (Global) and Alternative (Infrastructure)

Advantages of Harvest Income Strategy

• Geographic Diversification

Acquiring a broad internationally diversified exposure to income in your portfolio has clear advantages as it spreads risk and provides geographic and sectoral diversification.

• Asset Class Diversification

In addition to the geographic spread, the Strategy also provides exposure to a broad range of asset types.

• Liquidity

The funds selected for inclusion in the Strategy are all large liquid funds which can be traded daily allowing the investor to exit at a time of their choosing.

• Yield

At in excess of 5%, the annual payout from the strategy is clearly well ahead of current deposit rates. In addition we would expect this income to grow somewhat over the coming years.

.