Australian Equities Income Strategy

The Australian Equities Income Strategy is an actively managed strategy that has a dual investment objective, offering investors exposure to higher levels of tax effective income and capital growth. It is a concentrated portfolio of large cap Australian listed equities that has an investment horizon of three to five years. 

How to invest

Investments in the Australian Equities Income Strategy can be made via the Portfolio or via the Managed Fund.

Benchmark: S&P/ASX 200 Industrials Accumulation Index

2.58% p.a.* outperformance since inception

6.93% p.a. gross income yield since inception

Growing $ income over time

15-30 stocks

Inception date - December 2007

*Past performance is not an indicator of future performance. No allowance has been made for taxation and fees are not taken into account.

Investment strategy

The Portfolio delivers higher levels of tax effective income and capital growth through our quality investment philosophy.

The Portfolio invests in large-cap, quality companies that have sustainable and growing income capabilities. We define quality companies as those with earnings strength, income sustainability/growth, superior industry position, sound balance sheet, strong management and low ESG risk. Our assessment of a company’s quality is overlaid with a detailed valuation assessment where we are seeking to exploit mispriced, market inefficiencies.   

Income may be derived from dividends/distributions or capital management initiatives, including special dividends and/or share buybacks, and includes after-tax considerations. We categorise companies as: 

  • Growers: A company that is delivering below market income in the short term, however has the potential to deliver above market income growth over the long term. 
  • Compounders: A company that is currently delivering a market level of income, with the potential to deliver above market income growth on a sustainable basis.  
  • Cows: A company with a solid balance sheet and capital management potential (i.e. – higher pay-out, special dividends, buybacks) that is being under-valued on traditional earnings-based metrics. 
  • Yielders: A company that is delivering sustainable and cash-backed dividends, however with minimal (or no) income growth.  

The Portfolio is long-only, “style neutral” and invests over a period of three-to-five years.

Portfolio performance

Return on $100,000 invested at inception

Download Portfolio performance report
 1mth6mth1yr3yr5yr7yr10yrInception*
%%%% p.a.% p.a.% p.a.% p.a.% p.a.
DNR Capital Australian Equities Income Portfolio-2.79%2.35%9.13%11.50%9.40%8.87%13.62%8.30%
S&P/ASX 200 Industrials Accumulation Index-3.74%-4.14%1.48%6.12%6.80%6.24%11.03%5.72%
Excess return0.95%6.49%7.65%5.38%2.60%2.63%2.59%2.58%
Portfolio gross income yield1.47%3.26%6.26%6.09%6.50%6.63%9.87%7.08%
Franking %91.52%82.5%74.8%74.9%74.7%73.3%71.8%71.2%

Income performance

Accumulated net income (excluding franking) from $1,000 invested since inception

*inception date - December 2007

*Past performance is not an indication of future performance. No allowance has been made for taxation and fees are not taken into account.

Our Portfolio Managers

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Scott Kelly
Scott Kelly

Portfolio Manager

Jamie Nicol
Jamie Nicol

Director & Chief Investment Officer

Ratings

“the strategy benefits from a clearly articulated and robust investment approach which has produced strong long-term outcomes.”
Rated Highly Recommended by Lonsec Research
“Zenith notes that DNR was one of the pioneers of the SMA structure and remains the largest SMA provider in the Australian market place.”
Rated Recommended by Zenith

The rating issued 10/2021 DNR Capital Australian Equities High Conviction Portfolio, 10/2021 DNR capital Australian Equities Income Portfolio, 10/21 DNR Capital Australian Equities Socially Responsible Portfolio, 09/2021 DNR Capital Australian Equities High Conviction Fund, 09/2021 DNR Capital Australian Equities Income Fund & 08/2021 DNR Capital Australian Emerging Companies Fund are published by Lonsec Research Pty Ltd ABN 11 151 658 561 AFSL 421 445 (Lonsec). Ratings are general advice only, and have been prepared without taking account of your objectives, financial situation or needs. Consider your personal circumstances, read the product disclosure statement and seek independent financial advice before investing. The rating is not a recommendation to purchase, sell or hold any product. Past performance information is not indicative of future performance. Ratings are subject to change without notice and Lonsec assumes no obligation to update. Lonsec uses objective criteria and receives a fee from the Fund Manager. Visit lonsec.com.au for ratings information and to access the full report. © 2021 Lonsec. All rights reserved.

The Zenith Investment Partners (ABN 27 103 132 672, AFS Licence 226872) (“Zenith”) rating (assigned to the DNR Capital Australian Equities High Conviction Portfolio 06/2021, to the DNR Capital Australian Equities High Conviction Fund 06/2021, to the DNR Capital Australian Equities Socially responsible Portfolio 06/2021, to the DNR Capital Australian Equities Income Portfolio 06/2021, to the DNR Capital Australian Equities Income Fund 06/2021, to the DNR Capital Australian Emerging Companies Fund 02/2021) referred to in this website is limited to “General Advice” (s766B Corporations Act 2001) for Wholesale clients only. This advice has been prepared without taking into account the objectives, financial situation or needs of any individual, including target markets of financial products, where applicable, and is subject to change at any time without prior notice. It is not a specific recommendation to purchase, sell or hold the relevant product(s). Investors should seek independent financial advice before making an investment decision and should consider the appropriateness of this advice in light of their own objectives, financial situation and needs. Investors should obtain a copy of, and consider the PDS or offer document before making any decision and refer to the full Zenith Product Assessment available on the Zenith website. Past performance is not an indication of future performance. Zenith usually charges the product issuer, fund manager or related party to conduct Product Assessments. Full details regarding Zenith’s methodology, ratings definitions and regulatory compliance are available on our Product Assessments and at Fund Research Regulatory Guidelines.

Our investment strategies

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