GLG European Income Opportunities

The GLG European Income Opportunities Strategy is a long-only equity dividend strategy that aims to achieve long-term capital appreciation and stable income by investing in European equities.

  • Managed by Firmino Morgado (+25 years’ industry experience) and Filipe Bergana (+14 years’ industry experience)
  • Highly successful track record of managing a European equity strategy at Fidelity and a European equity dividend strategy at W4i
  • Deep synergies with Man GLG’s European Equities stock picking team – numerous sector specialists provide an analytical edge
  • Team aim to construct a high conviction portfolio of 25 to 35 positions that blends two dividend categories:
    • Dividend Yielders – stocks that have a high, sustainable dividend (>4%) but moderate growth potential
    • Dividend Growers – stocks that have a moderate dividend yield but have high growth potential (>5% p.a.)
  • The portfolio is managed on a highly active basis (seeking a tracking error of 4% -10%)

Approach

The Strategy aims to deliver a growing sustainable income through a high conviction and concentrated portfolio that combines stocks from companies the team deem to be either Divided Yielders or Dividend Growers. Companies are only considered if they display the following four key characteristics:

  • Sustainability – the ability, business model and cash flow to consistently be able to pay a dividend.
  • Persistence – capability to afford the dividend, have a clear dividend policy and a commitment to grow it over time.
  • Yield – current dividend yield needs to be attractive relative to price.
  • Growth – the dividend should have the potential to increase over time.

The team firmly believe that a company culture of growing dividends can lead to better capital allocation decisions. Their approach is to identify companies with business models that demonstrate consistent and sustainable growth potential and have management teams that are good capital allocators and reward shareholders with a growing and sustainable cash dividend. The ideal investment is one that the team will hold indefinitely and the end goal is to have a portfolio of high conviction ideas, independent of index weights.

Approach Long-only
Asset Class Equity
Geographic Focus Europe

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