A simple idea sits underneath everything we do. Australians want income they can rely on. They should be able to keep their growth, and keep more of their return after tax, at the same time.
More Australians than ever are funding their own lives from their investments: in retirement, inside super while they build, and through SMSFs, foundations and family companies. They share one need, reliable income with a capital base that does not shrink in real terms over time.
An equity income fund is one part of a portfolio: the part designed to generate regular, tax effective income from Australian shares.
Think of it working backwards from the goal. If a portfolio needs to fund a life, the question is not which fund performed best last month. It is which holdings are designed to generate regular, tax effective income while still pursuing growth of the capital itself. That is the job this Fund is built to do. Franking credits are most valuable to investors taxed at 0 to 30%: super funds, SMSFs, charities, retirees and companies.
A truly sustainable income stream relies on a growing capital base. Think of an apple tree: the larger and healthier the tree grows, the more fruit it can bear each season. Yet, not all trees are nurtured to achieve this balance; focusing solely on harvesting the fruit can inadvertently stall the tree's natural growth.
Our strategy treats income and capital growth as a single partnership. We focus on generating highly franked income from a diversified portfolio of Australian shares, while seeking to grow the core capital base. By aiming to expand the underlying investment, the strategy seeks to protect long-term purchasing power and support future income needs. The Fund aims to sit above the market benchmark on both income and total return.
Two investments with the same headline return are not equal once tax is counted. Tax works like an extra fee, and franking credits work to reduce it.
