3 Income Funds for monthly income for your 2013 investment ISA Go compare with our comparison table

3 Income Funds for monthly income for your 2013 investment ISA

06 March 2013 / by Isabel Buxton

When investing for income using your ISA allowance, and you are looking for monthly income one way to do it is to invest in more than one fund. Many fund providers offer income yielding funds that offer quarterly income and we have highlighted three funds when invested in together provide investors with a monthly income. By investing via your ISA allowance, not only will you benefit from tax free income but you will also benefit from capital gains tax exemption on any returns you make.

Standard Life Higher Income

• Yield 6.36% (variable, not guaranteed)
• Income paid quarterly - January, April, July, October,

With a current effective yield of 6.36%, this fund is aims to provide a significantly higher level of income than is generally available on gilts. This is achieved by investing mainly in Sterling and Euro denominated sub-investment grade corporate bonds.

Fund manager David Ennett and his investment team actively oversee the fund and may also invest in other bonds, such as investment grade corporate bonds and government bonds, if and when they spot good opportunities in these areas.

Find out more about the Standard Life Higher Income Fund.

Newton Asian Income

• Yield 5.0% (variable and not guaranteed)
• Income paid quarterly - February, May, August, November

Newton Asian Income is one of a growing number of investment funds extracting a mix of capital growth and dividend income for investors from the expanding economies of South-East Asia. Asia is developing a strong dividend culture, making it the leading region for income. Of course, there are risks to investing in emerging (and possibly more volatile) markets – for example, regulations may be less stringent. To counter this possibility, the fund operates with a defensive slant, investing in companies with robust balance sheets and the ability to pay cash to shareholders. Within the investment itself, diversification is offered via the fund’s exposure to a range of different South East Asian economies and currencies, ranging from Australia and New Zealand to Thailand and the Philippines.

Find out more about the Newton Asian Income Fund 

Kames Sterling Corporate Bond 

• Yield 4.1% (variable and not guaranteed)
• Income paid quarterly - March, June, September, December

Managed by David Roberts and Iain Buckle, this fund has recently benefitted from strong performances by holding including Barclays, Lloyds Banking Group and Direct Line. Notable recent performers in the Kames Sterling Corporate Bond have also included Center Parcs, Enterprise Inns and Punch Taverns.

Up to 10% of the Kames Sterling Corporate Bond Fund may be invested in high yield bonds, normally bonds from institutions with lower credit ratings. In order to take advantage of new opportunities, some investments may also be made in deposits, the money market and derivative instruments.

Find out more about the Kames Sterling Corporate Bond fund

Investing using a Fund Supermarket

By using Fair Investment’s Fund Supermarket you can save up to 20% on the Annual Management Charge (AMC) levied by many fund managers. This rebate is paid into a cash account which is set up for you when you first invest. 

The value of any investment can fall as well as rise, so remember that you may not get back your initial investment. Every investor has different aims and objectives, and so it’s wise to seek independent financial advice if you are unsure what investment is right for you.

Income yields quoted are correct as at 6th March 2013.

 © Fair Investment Company Limited

Select Income Funds
Fund ManagerFundFund Manager Initial Charge¹AMC³Income Yield*Select Fund°Fact SheetHow to Invest
Kames High Yield Bond0%0.75%4.99%yesFactsheetApply Now >
Income Paid Monthly. The primary investment objective is to maximise total return(income plus capital) by investing in a portfolio of predominately high yield bonds, selected investment grade bonds and cash. The fund may hold sterling and other currency denominated bonds hedged back to sterling. The fund may also invest in deposits, money market instruments, derivative instruments and forward transactions. See latest fund factsheet for details.
Newton Asian Income0%0.75%5.43%yesFactsheetApply Now >
Income Paid Quarterly.The objective of the Sub-Fund is to achieve income together with long-term capital growth predominantly through investments in securities in Asia Pacific ex Japan (including Australia & New Zealand) region. The Sub-Fund may also invest in collective investment schemes. See latest fund factsheet for details.
Invesco Perpetual Monthly Income Plus0%0.63%4.46%yesFactsheetApply Now >
Income Paid Monthly. Popular income fund that aims to achieve a high level of income whilst seeking to maximise total return through investing in high yielding corporate and Government bonds, together with UK equities. See latest fund factsheet for details.
Woodford Equity Income Fund0%0.75%3.50%yesFactsheetApply Now >
Our selected partner for investing in Neil Woodford's Equity Income fund is Barclays Stockbrokers, via their INVESTMENT ISA for new ISAs and ISA transfers, or their MARKETMASTER® ACCOUNT for non-ISA investments. Income Paid Quarterly.The fund’s investment objective is to provide investors with long-term appreciation through investing in stocks primarily listed on the UK stock exchanges. Up to 20% may be invested in international companies. The income objective is 10% higher than the FTSE All Share Index yield with an anticipated annual yield of 4.0%.
Artemis Income0%0.75%3.7%yesFactsheetApply Now >
Income Paid Twice Yearly. This fund aims to provide an increasing income and capital growth from investing mainly in ordinary shares, preference shares, convertible bonds and fixed-interest securities in the UK. We will not be restricted in our choice of investments, either by the size of the company, the industry it trades in, or the geographical split of the portfolio. See latest fund factsheet for details.
Jupiter Merlin Income Portfolio0%0.75%3.10%yesFactsheetApply Now >
To achieve a high and rising income with some potential for capital growth by investing predominantly in unit trusts, OEICs, Exchange Traded Funds and other collective investment schemes across several management groups. The underlying funds invest in equities, fixed interest stocks, commodities and property, principally in the UK. See latest fund factsheet for details.
M&G Global Dividend0%0.75%3.27%yesFactsheetApply Now >
Income Paid Quarterly. The Fund aims to deliver a dividend yield above the market average, by investing mainly in a range of global equities. The Fund aims to grow distributions over the long-term whilst also maximising total return (the combination of income and growth of capital). See latest fund factsheet for details.
M&G Optimal Income0%0.75%2.44%yesFactsheetApply Now >
Income Paid Twice Yearly.The fund aims to provide a total return to investors based on exposure to optimal income streams in investment markets. The fund invests across a broad range of fixed income assets according to where the fund manager identifies value. See latest fund factsheet for details.

*Current Income Yields are Gross, Variable and Not Guaranteed as at 17/10/13 - Yields are rounded down to one decimal place - See latest Fund Factsheet for details.

³AMC is the Annual Management Charge applied by the Fund Manager. 

°Select Fund - See how our funds are selected

 

Bonds: To provide the potential for overall returns these funds invest in bonds, also known as fixed interest securities. This is achieved by receiving regular interest on loans to companies or governments. There is a chance the bond issuer could fall into financial difficulty and will not be able to pay the interest or the loan back, which could result in a fall in your investment returns. Bonds can also be sensitive to trends in interest rate movements and if interest rates go up, the returns on your investment are likely to fall as bonds can become less attractive. On the other hand, if interest rates fall, bonds are likely to become more attractive and your investment returns increase.