Is 'natural' income the answer to the sequence of return problem?

Recent articles in Professional Adviser have considered different opportunities and challenges for income investors, including the challenge of sequence of return risk. This is about the impact on a portfolio and its ability to deliver the required long-term outcome for investors, for example, income. A typical example used is the impact on capital values if people invest just before a period of significant negative returns, compared with investing just before a period of significant positive returns, even if the long-term annualised returns are the same. In the first case, there c...