Our regular website visitors may recall that Neil wrote an article, ‘Local vs global’ a couple of years ago, which looked at the Equity Income Fund’s geographic exposure by analysing the revenues of the portfolio’s underlying holdings. In light of the recent changes to the portfolio strategy, we thought it would be interesting to take another look at this analysis to see how it has evolved.
The task isn’t as easy as it sounds, because practically every single company in which the fund is invested reports its geographic exposures in a subtly different way. But it is an interesting task and the result allows investors to look at the fund’s geographical exposure in a different light.
Over 80% of the fund’s assets are invested in the UK. However, as the chart below shows, the underlying revenues paint a different picture of the fund’s geographical exposure than the one investors would see by just looking at the exposure by country of listing.