Funds: Why you should venture into Europe

Generating a decent income from your money is getting harder. So where should you look? With sterling likely to keep sliding against the euro, European equity income funds might offer an answer, says Jody Clarke.

Generating a decent income from your money is getting harder. Corporate bond yields, for example, have fallen from a high of 8.5% in March to 5.8% today, according to the BARCAP bond index. Gilt (UK government bond) yields are at historic lows, and vulnerable to any changes in policy over quantitative easing. And UK equity income funds aren't much more attractive, given the risk of slashed dividends in the year to come.

So where can income-hungry investors look? With sterling likely to keep sliding against the euro, European equity income funds might offer an answer, and not just because they offer currency gains.

Subscribe to MoneyWeek

Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE

Get 6 issues free
https://cdn.mos.cms.futurecdn.net/flexiimages/mw70aro6gl1676370748.jpg

Sign up to Money Morning

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Sign up
Jody Clarke

Jody studied at the University of Limerick and was a senior writer for MoneyWeek. Jody is experienced in interviewing, for example digging into the lives of an ex-M15 agent and quirky business owners who have made millions. Jody’s other areas of expertise include advice on funds, stocks and house prices.