Investment approach

Although the level of dividends from any company cannot be relied upon, the team looks for high cash flow, which they regard as the best indicator a company can sustain its dividend. Cash flow is the money remaining after a company has covered all its costs.

Investment trusts can use gearing – the ability to borrow additional money to invest – and the team uses this power conservatively, targeting a borrowing range of 8-10% of the trust's net asset value (NAV). The goal is to amplify gains when share prices rise, although if they fall, gearing can amplify losses.