Income Strategy

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.

Deriving Income from Multiple Sources

By providing the investor with access to income from a number of asset types, it not only diversifies the risk but it allows a mix of higher fixed rate income payments such as might be received from bonds and infrastructure investments, but also to income generating equities where the income is likely to grow over time. The chart below shows the level of income growth delivered by various equity markets over the past ten years.

Investing for Income

The investment objective of this strategy is to generate income via four funds providing daily liquidity, a global spread and offering exposure to a range of asset classes.

These asset classes should not have a strong correlation to each other through the investment cycles.

Strategy Overview

Base Currency – Euro

Total Net Assets – €6.1 BN

Annual Distribution Target (Net) – 5.0%

Liquidity – Daily

Performance of Strategy

Income Strategy (31March 2022)

The Income Strategy delivered a further positive return over the past quarter and has now fully recovered from the sharp value fall of March 2020. While average income from the Strategy fell a little in 2020, it has consistently remained above 5% per annum. While the bond component of the strategy could continue to suffer from bouts of volatility, we are confident of further recovery over the remainder of the year as we believe income producing assets will fare better than the market averages.

The Importance of Investing for Income

Explicitly or implicitly, investment markets value all assets on their future ability to deliver income, over both the short term and the long term. Asset prices tend to rise with expectations that the outlook for future income deliverability has improved and of course the opposite happens when the outlook disimproves due to lower profitability or other factors. Even companies who pay no dividend and who may even be unprofitable can be valued quite highly if the market expects that the company will have the capacity to pay substantial dividends in the future.

For investors, the other important facet of income is that income paying assets tend to be considerably more stable than the average in volatile markets.

Other Investment Strategies Available from Harvest:

Cash Alternative Strategy

Liquid Property Strategy

Future Tech Strategy

ESG Strategy