Five plays for contrarian investors

Julian Cane, manager of F&C Equity Income Fund, tells MoneyWeek why he looks for high yields in out-of-favour sectors - plus five contrarian stocks he's invested in now.

A fund in the UK Equity Income sector should generate a yield of at least 110% of the FTSE All-Share index, according to Investment Management Association guidelines. Of course, the higher the yield you have to seek, the more restricted you are when it comes to investing. The F&C UK Equity Income fund, which has a yield of 3.2% against the FTSE All-Share average of 2.8%, is therefore limited in its options when it comes to investing in outright growth stocks. Our search for higher-yielding stocks encourages a contrarian approach, which pushes high-income-generating funds towards sectors out of favour with the market.

Top sectors for contrarians: oil and pharmas

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