How to find top-quality income picks in the UK stock market

Four top-quality UK stock market picks according to Iain Pyle, manager of Shires Income Trust

Economic development and UK stock market concept with Britain flag and graphs
(Image credit: Getty Images)

Income is crucial to many investors and, over the long term, has been a major component of total return. Yet delivering high levels of income comes with challenges. It is easy to be tempted to own stocks that are overdistributing their profits as dividend payouts, while high-quality or high-growth stocks are generally priced accordingly, with low or non-existent yields.

Shires Income Trust applies a differentiated approach to income investing. We have 20% of the portfolio in high-yield preference shares. These deliver stable income but also allow us to diversify the equity portfolio, providing scope to hold companies with strong growth or dividend growth potential.

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Iain is a Senior Investment Director in the Developed Market Equities team at abrdn. In addition to being lead manager of Shires Income Trust, he manages UK and Global Income portfolios and the Future Minerals thematic fund.  Iain joined the company in January 2015 from Sanford Bernstein where he was a Vice President covering the European Energy sector. He previously worked for PwC as a consultant. Iain graduated with a MEng degree in Chemical Engineering from Imperial College London and with an MSc in Operational Research from Warwick Business School. He is a CFA charterholder and ACA.