OS: And then, finally, and I'm looking for a really honest answer here, what have been the best and perhaps the worst moments of your career and specifically your career in income? And by having a total return mindset we really try to avoid doing that. And so, I think a temptation that I guess many income investors might fall into would be to ultimately sacrifice capital in order to chase yield. So, overall, our fund is trying to deliver a total return proposition, not just an income unit. So, that's one of the reasons why we like growth companies: you're hopefully combining both attractive dividend yields, especially over time, but also with potential for capital growth.
KW: One of the obvious things that could go wrong is that you get tempted by high or seemingly high day one or near term dividend yields and fail to spot that actually those dividend yields are high for a reason and the reason is that ultimately the market is anticipating that the capital components of the equation are likely to fall. And on the negative side, what temptations could an expert investor fall prey to here? I mean, there's clearly a lot of funds, a lot of companies to choose from. So, our job is to really sniff out the fundamentals of the companies, really kick the tires on the sustainability of those cash flows and earnings streams that can underpin the dividend and then, ideally, find those businesses that over the very long term are going to not only do that but give us attractive capital growth because they're also growing companies. And we think that companies that pay dividends typically are better at allocating capital and therefore, also a good indication of quality.
And because often we're investing in smaller companies, those cash flows can grow over time and therefore the capacity to pay dividends can also grow over time.
The role of an expert income investor, I think, probably sounds a little bit glib to say it, but I think it's about really being able to uncover those sort of areas of sustainable income wherever you might be able to find them, and the Gresham House UK Multi Cap Income Fund, as the name suggests, is a fund that can go anywhere across the market cap spectrum and really trying to focus on high-quality companies where based on the fundamentals of those businesses we believe that they can pay attractive dividends which are backed by earnings and cash flow. Firstly, and obviously, you want to make money as an income investor, but what should the actual goal of an expert income investor be? Here to give me his take on over two decades in the investment and research world is Ken Wotton, co-manager of the Morningstar Silver-rated LF Gresham House UK Multi Cap Income fund. Having looked a little bit at investor tips for beginners, I wanted to make a little video for those of you with a little bit more experience.
Chase smith go fund me full#
Ollie Smith: Income week is in full swing here at .uk.
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