Cazenove launches European income fund for Rice

Cazenove Capital has confirmed it is launching its European Income fund, run by manager Chris Rice, in May this year.

As revealed by Investment Week last year, the fund, to be run by Cazenove Capital’s head of Pan-European equities Rice (pictured), will aim to deliver income with some long-term capital growth.

It aims to outperform the FTSE World Europe Index by 2% on a rolling three-year basis, and deliver a 110% of its yield over the medium term.

Rice will be joined on the fund by James Sym, who has moved to the European equities desk having previously worked alongside UK income fund manager Matt Hudson.

Sym has worked in the UK equities team at Cazenove Capital since 2007, and the group said his experience in equity income mandates will provide an invaluable resource for the new fund.

Cazenove has launched the fund to take advantage of the sell-off in stocks across Europe, which has left yields above 4% on average in the FTSEurofirst 300.

The fund will be fairly concentrated, typically running between 30 to 50 stocks.

Rice said: “The ongoing eurozone crisis presents a wealth of opportunities for income investors. With subdued growth and valuations at their lowest levels for 30 years, there is considerable demand for tangible direct returns on investment in the shape of dividends.”

“Europe is a dynamic market and we will adopt a business cycle approach to managing the fund. In recovery phases of the market, this will see us favouring cyclicals with the potential for dividend recovery while in an economic slowdown we will be biased towards companies offering potential for dividend growth.”

“This approach should enable us to provide consistent and increasing levels of income for our investors with some capital growth in a range of market conditions.”

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