The Lemon Fool

I've been running a portfolio of thirteen income IT's for four or five years now (bought over a period of a year or so) - it complements a HYP-type portfolio of London listed equities. I was quite adventurous with the yield and aimed at a fair bit of diversification. The holdings are as follows (with current yields):

Aberdeen Latin American Income (ALAI) 5.0%
Blackrock Income Strategies (BIST) 6.1%
Blackrock Commodity Income (BRCI) 6.8%
Henderson Diversified Income (HDIV) 5.5%
Henderson Far East Income (HFEL) 5.7%
Henderson High Income (HHI) 5.0%
HICL Infrastructure (HICL) 4.6%
John Laing Infrastructure Fund (JLIF) 5.2%
Merchants Trust (MRCH) 5.3%
Murray International Trust (MYI) 4.1%
New City High Yield Fund (NCYF) 7.0%
Real Estate Credit Investments (RECI) 6.5%
Shires Income (SHRS) 5.5%

One or two of the constituents have a had a bit of a rocky (no pun intended!) time with regard to their capital value, but none disastrously so and several have done pretty well. More importantly, they have all consistently paid dividends at a very healthy level and, given the high initial yield, I've been very pleasantly surprised by the performance. I now wish to add enough funds to increase the payout by about 25%. I'm very comfortable with the idea of topping up existing holdings to achieve this, but would be interested to know whether anyone can suggest any new addition(s) that would improve the balance/diversification of the portfolio?

CP

Have you compared your list to John Barron's Income IT Portfolio? This is a diversified high yield IT portfolio that yields 4.8% which I know is less that you have achieved but it might give you some ideas. I think its details are available on the free part of the Investors Chronicle web site.
MM

You may also find this thread useful:

viewtopic.php?f=8&t=92

CryptoPlankton wrote:... but would be interested to know whether anyone can suggest any new addition(s) that would improve the balance/diversification of the portfolio?

CP

I have 5 of your holdings. Here are a few more to look at, with yields in your desired ballpark:

A couple of European trusts
EAT European Assets Trust 7.4%
PEY Princess Private Equity Holding 5.8%

Peer to peer lending
P2P P2P Global Investments 7.4%

Property REITs
HSTN Hansteen Holdings REIT 5.0%
RDI Redefine International 7.9%

That should add to your diversity.

Tramrider

In addition to many of yours, I also hold

CMHY City Merchants High Yield Trust 5.1%
EAT European Assets Trust 7.2%
FPEO F&C Private Equity 4.1%
HINT Henderson International Income Trust 3.2%
IPE Invesco Perpetual Enchanced Income Limited 6.4%
IVI Invesco Income Growth Trust 3.7%
MCT Middlefield Canadian Income PCC 4.9%
SLET Standard Life Equity Income Trust 3.9%
SOI Schroder Oriental Income Fund 3.7%
STS Securities Trust of Scotland 3.5%

Yields are from http://www.iii.co.uk today. Generally, slightly lower yields than your list but the market is high. EAT AND FPEO have done well in capital terms but all have paid regularly and there is a bit of diversity geographically and away from ITs with a high proportion of preference shares or bonds eg CMHY.
GCD

Many thanks for all the replies, they've thrown up some interesting ideas that I look forward to investigating further...

CP

CryptoPlankton wrote:Many thanks for all the replies, they've thrown up some interesting ideas that I look forward to investigating further...

CP

Nothing wrong with the suggestions, but if you are going to invest, check the yields mentioned in the thread, some are lower than mentioned looking forward, in particular EAT, a bit lower, both BRCI and P2P quite a bit lower. Always check these things for yourself through latest divis, company reports and RNS before investing.

Ozyu