From MoneyWeek · · 1m 10s
Two Alternative Income Funds
Two UK income funds target different debt strategies for returns.
In brief
Two UK income funds target different debt strategies for returns. TwentyFour Income Fund and TwentyFour Select Monthly Income Fund offer distinct debt strategies with varying returns and risks. Originally reported by MoneyWeek.
TwentyFour Income Fund
TwentyFour Income Fund invests in diversified debt securities with floating rates.
“The underlying assets are floating-rate, ie, payments vary with changes in interest rates.”
Fund Structure
The fund holds 15% investment grade, 52% sub-investment grade, and 33% unrated debt.
Target Returns
The fund aims for 6%-9% annual returns with a minimum 8p quarterly dividend.
Performance
The fund has averaged just under 8% annual net asset value returns since 2013.
TwentyFour Select Monthly Income Fund
TwentyFour Select Monthly Income Fund invests in broader debt with higher yield potential.
“The aim of taking advantage of the "premium yields available in less liquid securities across the global credit markets".”
Portfolio Composition
The fund holds AT1 securities, ABS, and insurer debt with 40% in AT1 securities.
Rating Details
The fund's portfolio includes BBB-rated securities with 7% unrated debt.
Rate Sensitivity
The fund's long-term debt underperforms when interest rates rise.
Performance Impact
The fund's debt has fallen 10% in 2026 and 35% since 2022 due to rising rates.
In short
TwentyFour Income Fund and TwentyFour Select Monthly Income Fund offer distinct debt strategies with varying returns and risks.
