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Gresham House plc

Lessons from Vodafone: how to diversify your income portfolio

In the wake of Vodafone’s significant dividend cut this week, leading fund managers explain why it is crucial to diversify your income portfolio and avoid potential mis-haps.

Small and mid-cap gems

Ken Wotton, manager of LF Gresham House UK Multi Cap Income fund, noted that many UK equity income strategies are disproportionately invested in a relatively small number of mega-cap stocks.

“However, this herding has created an opportunity for managers willing to go beyond the status quo,”
Ken added.

When it comes to opportunities in the small and mid-cap space, he is spotting numerous under-researched and under-the-radar companies with the potential for dividend growth over the coming years.

“These stocks are also typically trading at a valuation discount to larger, more well-known peers,” he said.

Gresham House plc (LON:GHE) is an AIM quoted specialist asset manager providing funds, direct investments and tailored investment solutions, including co-investment across a range of highly differentiated alternative investment strategies.

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Disclaimer: Statements in this article should not be considered investment advice, which is best sought directly from a qualified professional.