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Invesco Perpetual Income Fund

May 2017 (Content as at 30 April 2017)

Overview

Objective

The Invesco Perpetual Income Fund aims to achieve a reasonable level of income, together with capital growth. The fund intends to invest primarily in UK companies, with the balance invested internationally. In pursuing this objective, the fund managers may include investments that they consider appropriate which include transferable securities, unlisted securities, money market instruments, warrants, collective investment schemes, deposits and other permitted investments and transactions as detailed in Appendix 2 of the most recent Prospectus.

Fixed interest roundtable Q&A: where next for bond markets?

Video

15 July 2015

Invesco Perpetual Fixed Interest team

In this live roundtable with fund managers from our Fixed Interest team, they discussed key issues including whether the Greek debt crisis matters for bond markets and the current macroeconomic backdrop.

Market commentary

Political events continued to dominate UK equity market movements in April. The market fell sharply in response to Prime Minister Theresa May’s call for a snap general election; sterling rallied to a six month-high relative to the US dollar on the news, exerting downward pressure on the share prices of companies with non-sterling denominated earnings. In contrast to the resilient signals recorded since the EU Referendum, economic data released in April suggested the beginnings of a slowdown in the UK economy. UK gross domestic product (GDP) rose 0.3 per cent in the first quarter of the year, slowing significantly from the 0.7 per cent growth rate recorded in the fourth quarter of 2016. Corporate news saw BTG confirm full year revenues at the upper end of guidance. EasyJet reported a 10 per cent year on year increase in passenger numbers, despite the challenging backdrop through 2016. Allied Minds announced the write down of seven businesses within its portfolio, re-focusing resources on projects with greater capacity for commercialisation.

Fund strategy

Whilst the headline forecasts for earnings growth in 2017 look good for a number of sectors in the UK equity market, the fund manager is concerned that this currency-driven benefit has been largely accounted for and that too many risks are not priced into equities. The interest rate environment does not look helpful overall - the US Federal Reserve has now commenced a policy of raising rates, with further hikes expected this year. Geopolitical developments may also yet prove disruptive for business confidence. The fund manager’s objective is to invest, with sensible diversification, where he sees the prospect of making money in absolute terms – either driven by growing dividends or from companies that can improve or transform their financial prospects regardless of the shifting economic weather.

Key facts
Product type ICVC
Launch date 16 June 1979
Fund size £5,636.04m
Historic yield 3.07%
Sector IA UK All Companies NR
Available in an ISA? Yes

Fund manager

Mark Barnett

Title: Head of UK Equities
Team: Invesco Perpetual - UK Equities
Fund details
Fund currency GBP
Trading frequency Daily
Accounting period ends 31 March
30 September
Share types
SEDOL ISIN
Accumulation 3303126 GB0033031260
Income 3305382 GB0033053827
Accumulation (No Trail) B1W7HK4 GB00B1W7HK49
Income (No Trail) B1W7HL5 GB00B1W7HL55
Y (Acc) BJ04HW5 GB00BJ04HW53
Y (Inc) BJ04HX6 GB00BJ04HX60
Z (Acc) B8N46V7 GB00B8N46V79
Z (Inc) B8N46W8 GB00B8N46W86
Investment levels
Minimum lump sum £500

Performance

Charges

One-off charges taken before you invest

Entry charge

The entry charge for the fund is up to 5%. This is the maximum that might be taken out of your money before it is invested. For example, if you invest £1,000, an entry charge of 5% means £950 of your money will be used to buy shares in the fund.

The entry charge covers the costs of setting up your investment.

If you invest through a third party (such as a financial adviser), but do not receive financial advice on your investment, this charge may include payments to that third party. For more details see "What share classes are available for your ICVC funds?".

Exit charge

There is no exit charge for the fund.

Charges taken from the fund over a year

Ongoing charge

The ongoing charge figure is based on a fixed, all-inclusive fee and excludes portfolio transaction costs. The ongoing charge for each share class can be found in the relevant Key Investor Information Document available under 'Literature'. Investors will be provided with advance notice if any increases to this figure occur.

The ongoing charge covers all aspects of operating the fund during the year, including fees paid for investment management, administration and the independent oversight functions.

If you invest through a third party (such as a financial adviser), but do not receive financial advice on your investment, this charge may include payments to that third party. Once invested, your contract note or acknowledgement letter will show the amount of any payment in cash terms. For more details see "What share classes are available for your ICVC funds?".

Charges taken from the fund under specific conditions

Performance fee

No performance fee is charged.

Portfolio transaction costs1

On average, over the last three financial years, the fund incurred broker commissions of 0.06% and transfer taxes of 0.04%, as a necessary part of buying and selling the fund's underlying investments in order to achieve the investment objective. A proportion of these costs is recovered directly from investors joining and leaving the fund.

When the fund buys or sells shares, broker commissions and transfer taxes are paid by the fund on each transaction. In addition, there is a dealing spread between the buying and selling prices of the underlying investments. Unlike shares, other types of investments (such as bonds, money market instruments and derivatives) have no separately identifiable transaction costs; these costs form part of the dealing spread. Dealing spreads vary considerably depending on the transaction value and market sentiment. The estimated average dealing spread for the fund is 0.64% of the transaction value.

Comparing portfolio transaction costs for a range of funds may give a false impression of the relative costs of investing in them, for the following reasons:

  • Transaction costs do not necessarily reduce returns. The net impact of dealing is the combination of the effectiveness of the manager's investment decisions in improving returns and the associate costs of investment
  • Historic transaction costs are not an effective indicator of the future impact on performance
  • Transaction costs for buying and selling investments due to other investors joining or leaving the fund may be recovered from those investors. For further information see Pricing policy note below
  • Transaction costs vary from country to country
  • Transaction costs vary depending on the types of investment in which a fund invests
  • As the manager's investment decisions are not predictable, transaction costs are also not predictable

Pricing policy note1

We operate a single pricing methodology for this fund and reserve the right to adjust the fund's price to protect your investment from the costs of buying and selling investments that result from other investors joining or leaving the fund. The amount of any such adjustment is calculated by reference to the estimated costs of dealing in the underlying investments, including any dealing spreads, broker commissions and transfer taxes.

Typical adjustments to the fund's price are to increase it by 0.75% for net inflows or decrease it by 0.46% for net outflows.

We usually adjust the price to the maximum extent possible when the value of net contributions or withdrawals is significant, which helps to protect your investment from the costs of the resultant transactions.

1The fund's financial year end is 31 March 2016. Figures in these sections are as at 31 March 2016.

Holdings

 

Literature

Factsheets

Invesco Perpetual Income Fund Factsheet  (263 KB)

KIIDs

Invesco Perpetual Income Fund KIID acc  (201 KB)

Invesco Perpetual Income Fund KIID acc (No trail)  (202 KB)

Invesco Perpetual Income Fund KIID acc (Y)  (199 KB)

Invesco Perpetual Income Fund KIID acc (Z)  (200 KB)

Invesco Perpetual Income Fund KIID inc  (201 KB)

Invesco Perpetual Income Fund KIID inc (No trail)  (201 KB)

Invesco Perpetual Income Fund KIID inc (Y)  (199 KB)

Invesco Perpetual Income Fund KIID inc (Z)  (200 KB)

Application form

ICVC & ISA Application booklet 17/18  (190 KB)

Product & fund information

ICVC Supplementary Information Document (SID)  (4 MB)

Financial reports

Invesco Perpetual UK 2 Investment Series Annual Report 2016 (Short Report)  (231 KB)

Invesco Perpetual UK 2 Investment Series Annual Report 2016 (Long Form)  (687 KB)

Invesco Perpetual UK 2 Investment Series Annual Report 2015 (Short Report)  (248 KB)

Invesco Perpetual UK 2 Investment Series Annual Report 2015 (Long Form)  (728 KB)

Invesco Perpetual UK 2 Investment Series Interim Report 2015 (Short Report)  (254 KB)

Invesco Perpetual UK 2 Investment Series Interim Report 2015 (Long Form)  (450 KB)

Invesco Perpetual UK 2 Investment Series Interim Report 2016 (Short Report)  (300 KB)

Invesco Perpetual UK 2 Investment Series Interim Report 2016 (Long Form)  (555 KB)

Forms

ISA Additional Permitted Subscription application form  (69 KB)

UK equities – 2017 investment outlook

Video

29 December 2016

Mark Barnett, Head of UK Equities, Invesco Perpetual

UK equity valuations face four main challenges in 2017, which may force a reassessment of current valuations.

The international reach of the UK equity market

Article

14 August 2015

Mark Barnett, Head of UK Equities, Invesco Perpetual

Whilst some might argue that the more bells and whistles a fund has the better, Invesco Perpetual’s UK equities team prefers to keep things simple, and local.

UK Equities Investment Trust update

Video

14 March 2017

Mark Barnett, Head of UK Equities, Invesco Perpetual

Mark Barnett shares his thoughts on his investment philosophy, how he sees the Brexit negotiations impacting on equity markets in 2017 and provides his views on some of the key sectors he holds in the portfolios he manages.

 

Investment risks

The value of investments and any income will fluctuate (this may partly be the result of exchange rate fluctuations) and investors may not get back the full amount invested. Past performance is not a guide to future returns.

The fund may use derivatives (complex instruments) in an attempt to reduce the overall risk of its investments, reduce the costs of investing and/or generate additional capital or income, although this may not be achieved. The use of such complex instruments may result in greater fluctuations of the value of the fund. The Manager, however, will ensure that the use of derivatives within the fund does not materially alter the overall risk profile of the fund.

Important information

Yield and performance figures are based on the z (accumulation) share class. As this was launched on 12 November 2012, for the periods prior to this launch date, performance figures are based on the income share class, without any adjustment for fees. Performance figures for all share classes can be found in the relevant Key Investor Information Document.

All fund portfolio figures are as at date shown (source: Invesco Perpetual).

Performance figures are shown in sterling, inclusive of reinvested income and net of the ongoing charge and portfolio transaction costs to date shown. The figures do not reflect the entry charge paid by individual investors. Sector average performance is calculated on an equivalent basis (source: Lipper).

The Historic Yield reflects distributions declared over the past twelve months as a percentage of the mid-market price of the fund, as at the date shown. It does not include any entry charge and investors may be subject to tax on their distributions. The fund’s ongoing charge is charged to capital. This has the effect of increasing the distributions for the year by the amount of the ongoing charge and constraining the fund’s capital performance to an equivalent extent.

Where Invesco Perpetual has expressed views and opinions, these may change. Where securities are mentioned they do not necessarily represent a specific portfolio holding and do not constitute a recommendation to purchase, hold or sell.

For the most up to date information on our funds, please refer to the relevant fund and share class-specific Key Investor Information Documents, the Supplementary Information Document, the Annual or Interim Short Reports and the Prospectus, which are available using the contact details shown.