Because I'm happy: Smith & Williamson's Burns shares his strategy

Smith & Williamson's Burns shares his strategy

clock • 4 min read

James Burns, manager of Smith & Williamson's MM Cautious Growth fund, tells Rebecca Jones why he is happy to forego income for capital growth using zero dividend preference shares...

1 What is your investment strategy? We primarily invest in zero dividend preference shares, which is the second share class of split capital investment trusts - the first being ordinary shares. Rather than income, the zero shares pay out a fixed capital amount at the end of their life, normally five years. The upside is capped but they are less risky than ordinary shares. This fund churns out around 5% to 7% per year capital growth and the zero shares are pretty steady performers. The rest of the fund is in structured products and investment trusts, where we believe we can achieve a si...

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