Overview

The Neptune Quarterly Income Fund is designed for investors seeking a regular income and long-term growth. Leveraging Neptune’s in-house sector research, its income share classes pay distributions four times a year from a portfolio of UK stocks identified as being able to grow their dividends significantly. The Fund is also designed to capture special dividend payments and has the ability to invest up to 20% of the portfolio in non-UK stocks, giving exposure to high-yielding opportunities overseas.

Investment objective

To provide a rising level of income, with the potential for some capital growth, by investing mainly in UK companies’ shares and bonds (issued by companies and/or the government), selected at the manager's discretion.

There is no assurance that the investment objective will be achieved.

Ongoing charge (%) 1.38
Net yield (%) -
Minimum investment
Initial 250,000
Top up -
Regular -
Share class codes
ISIN GB00B8BFZ158
Bloomberg NEPQIBA:LN
SEDOL B8BFZ15

Fund managers

Robin Geffen

Fund manager

Storm Uru

Assistant Manager
  • Role at Neptune

    Fund Manager

  • Time at Neptune

    4 years

  • Research focus

    Industrials

George Boyd-Bowman

Assistant Manager
  • Role at Neptune

    Investment Director, Head of US Equities

  • Time at Neptune

    8 years

  • Research focus

    Financials

James O'Connor

Assistant Fund Manager
  • Role at Neptune

    Assistant Fund Manager

  • Time at Neptune

    3 years

  • Research focus

    Industrials and Materials

Performance

Cumulative performance (%)

1 mth 1 mth YTD 1 yr 3 yrs 5 yrs 10 yrs Launch
Fund -5.41 -3.84 -3.46 8.68 19.11 129.59 126.16
Benchmark -5.19 -4.37 -1.47 25.37 30.46 156.66 142.67
IA sector -5.43 -5.04 -3.62 16.07 28.39 161.97 125.71
IA rank 43/88 31/87 51/87 70/80 65/76 44/53 30/44
Quartile 2 2 3 4 4 4 3
Large chart

Calendar year performance (%)

2013 2014 2015 2016 2017
Fund 22.58 2.41 8.01 0.51 9.26
Benchmark 20.81 1.18 0.98 16.75 13.10
IA sector 26.57 3.55 6.58 9.07 11.63
IA rank 52/74 51/76 25/76 77/81 62/83
Quartile 3 3 2 4 3

Performance data supplied by Morningstar; C Accumulation share class performance, in sterling with net income reinvested and no initial charges. Launch date used is 07/07/2005, which is the launch of the A Accumulation share class. The C Accumulation share class was launched on 03/10/2012, so during the period from 07/07/2005 to 03/10/2012 the performance record is based on the pre-existing A Accumulation share class. Reported date prices used for cumulative and discrete performance tables. The performance of other share classes may differ.

IA sector rankings may change at any time as a result of closure, movement between sectors or price amendments by competitor funds. The Fund's IA sector is IA UK Equity Income and the benchmark is FTSE All-Share Index. Neptune’s funds are not tied to replicating a benchmark and holdings can therefore vary from those in the index quoted. For this reason, the comparison index should be used for reference only.

This Fund may have a high historic volatility rating and past performance is not a guide to future performance. The value of an investment and any income from it can fall as well as rise as a result of market and currency fluctuations and you and your clients may not get back the original amount invested.

Calendar year performance (%)

2013 2014 2015 2016 2017
Fund - - - - -
Benchmark - - - - -
IA sector - - - - -
IA rank - - - - -
Quartile - - - - -

Performance data supplied by Morningstar; C Accumulation share class performance, in sterling with net income reinvested and no initial charges. Launch date used is 07/07/2005, which is the launch of the A Accumulation share class. The C Accumulation share class was launched on 03/10/2012, so during the period from 07/07/2005 to 03/10/2012 the performance record is based on the pre-existing A Accumulation share class. Reported date prices used for cumulative and discrete performance tables. The performance of other share classes may differ.

IA sector rankings may change at any time as a result of closure, movement between sectors or price amendments by competitor funds. The Fund's IA sector is IA UK Equity Income and the benchmark is FTSE All-Share Index. Neptune’s funds are not tied to replicating a benchmark and holdings can therefore vary from those in the index quoted. For this reason, the comparison index should be used for reference only.

This Fund may have a high historic volatility rating and past performance is not a guide to future performance. The value of an investment and any income from it can fall as well as rise as a result of market and currency fluctuations and you and your clients may not get back the original amount invested.

Portfolio

Data as at 31/10/2018

Top ten holdings (%)

FundIndex
CME Group 3.09 0.00
Apple 2.93 0.00
Halma 2.77 0.22
Microsoft 2.76 0.00
Croda 2.73 0.27
Visa 2.70 0.00
Motorola Solutions 2.68 0.00
Victrex 2.66 0.09
Diageo 2.66 2.87
Antofagasta 2.65 0.12

Sector (%)

FundIndex
Financials 28.7 22.8
Materials 19.7 9.3
Information technology 18.3 1.5
Industrials 9.0 10.4
Consumer staples 7.6 13.6
Energy 5.2 14.7
Alternatives 5.0 0.0
Healthcare 3.7 9.8
Consumer discretionary 2.6 7.6
Communication services 0.0 4.9
Utilities 0.0 2.9
Cash 0.2 0.0

Top ten holdings (%)

FundIndex
CME Group 3.09 0.00
Apple 2.93 0.00
Halma 2.77 0.22
Microsoft 2.76 0.00
Croda 2.73 0.27
Visa 2.70 0.00
Motorola Solutions 2.68 0.00
Victrex 2.66 0.09
Diageo 2.66 2.87
Antofagasta 2.65 0.12

Sector (%)

FundIndex
Financials 28.7 22.8
Materials 19.7 9.3
Information technology 18.3 1.5
Industrials 9.0 10.4
Consumer staples 7.6 13.6
Energy 5.2 14.7
Alternatives 5.0 0.0
Healthcare 3.7 9.8
Consumer discretionary 2.6 7.6
Communication services 0.0 4.9
Utilities 0.0 2.9
Cash 0.2 0.0

    Active share

    Active share 67.7%

    The Active Share is a measure of how different a portfolio is from its benchmark, i.e. how 'actively managed' a fund is relative to its respective Index. A score of 100% indicates the fund's holdings are completely different, whilst 0% indicates the portfolio exactly replicates the Index.

    Number of holdings

    No. of holdings 39

    Total number of holdings, excluding cash positions.

    Quarterly commentary

    Q3 2018

    Market overview

    Despite strong returns from global equity markets, the FTSE All-Share Index witnessed a higher degree of volatility and ended the quarter with a negative return of -0.82%. There were three major themes for UK investors to grapple with over the quarter: the uncertainty surrounding the potential for a no-deal Brexit, the fallout of the escalating trade war between the US and China and the Bank of England’s decision to raise interest rates to the highest level since 2009 thanks to an improvement in UK growth. The concerns surrounding Brexit negotiations weighed on sterling, which combined with further evidence of a deteriorating outlook for the UK consumer, meant the more domestically-focused FTSE 250 Index struggled over the quarter. However, the market’s reaction to increased tariffs between the US and China, and its impact on global growth, meant mega-cap stocks that are heavily exposed to the global economy (particularly emerging markets) – such as mining and banks – underperformed as well.

    Fund attribution

    The Fund has, for some time, maximised its non-UK exposure and therefore it benefitted from sterling weakness. The main contributors to the Fund’s returns were its US tech holdings, which are major differentiator compared to other IA UK Equity Income funds. Notable performers included Microsoft and Apple, though other US holdings such as CME Group also contributed positively. The main detractors to the Fund’s performance were largely stocks with exposure to emerging markets, given sentiment towards the developing world waned considerably over the quarter thanks to US dollar strength and an escalation in trade tensions between Washington and Beijing. These included the likes of Glencore, Rio Tinto and HSBC.

    Little changed in terms of portfolio positioning over the quarter, with the Fund continuing to focus on stocks that are growing earnings, have strong pricing power and have the ability to cover their dividend. The Fund continues to maintain its avoidance of bond proxies and so-called defensive areas of the market, which we believe trade at excessive valuations, yet have earnings that will continue to come under pressure.

    Outlook

    While we are positive on the underlying income and capital growth for the Fund, and are generally positive on global growth, we remain cautious on the UK economy and many of the largest stocks within the market. Its seems likely that Brexit negotiations (with certain major issues yet to be sorted), will continue to hurt sentiment towards the UK market, while the US-China trade war is likely to create shorter term volatility. In this environment, we believe it is important to remain diversified and to not follow the crowd – as shown by the fact that many of the popular ‘defensive’ areas of the market have performed poorly this year.

    Robin Geffen

    Fund manager

    The main contributors to the Fund’s returns were its US tech holdings, which are major differentiator compared to other IA UK Equity Income funds

    Insights & analysis

    Prices

    Choose date
    Share class Bid price Offer price Change (%) Date
    C Acc GBP 143.60 144.40 -0.35 14/12/2018
    C Inc GBP 109.60 110.20 -0.36 14/12/2018

    Neptune funds are priced every working day at 12 noon UK time and prices should be updated here by 6pm the same day.

    The prices shown should be taken only as an indication of the value of shares. Prices are set on a forward-pricing basis which means that any instruction to buy or sell shares will be fulfilled at the price set at 12 noon the next day.

    If you are looking for historical prices of closed funds or share classes, or are having any difficulty finding the price information you require, please call our customer services team on 0800 587 5051.

    Literature

    Codes & fees

    ISIN SEDOL Bloomberg Ongoing charge (%)
    C Acc GBP GB00B8BFZ158 B8BFZ15 NEPQIBA:LN 1.38
    C Inc GBP GB00B8J70J62 B8J70J6 NEPQIBI:LN 1.38

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