Investing in global equities for income and capital growth

Global equity income has always been a stalwart for investors seeking long-term growth and income. But today, many strategies look the same. They chase the same stocks and fail to offer investors real differentiation – especially when the market becomes overly reliant on a small group of large companies to drive returns. Invesco Global Equity Income Trust (IGET) seeks to offer something deliberately different. By looking where others don’t, we offer a predictable income, potential for long-term growth, and genuine diversification for our investors.

Please read the Investment risks at the bottom of the page.

Dividend-paying companies are a compelling long-term strategy

The popularity of global equities is hardly surprising. Not only do they offer the potential for significant long-term capital growth, but dividend-paying global companies can also enhance your portfolio’s resilience. Reinvesting these dividends has a significant ‘compounding’ effect, acting as a boost to returns when share prices rise and a cushion when they fall.

A good blend of dividend-paying companies can also help to smooth out the investment journey through different market conditions, by giving investors a truly diversified source of returns. What’s more, paying regular dividends also reflects a company’s confidence in itself – and its own ability to generate profits – making such firms attractive in their own right.

But too many global funds look the same

Despite the immense breadth of opportunity across global equities, many fund managers have increasingly preferred to stick with the crowd – pursuing the same large, well-known companies.

But following the herd can mean getting tangled up in the risks associated with too many investors being concentrated in the same investments. What happens, for example, when the hype around a narrow band of stocks pushes share prices to levels that seem unsustainable, or out of sync with the actual financial position or attributes of these companies? When share prices rise too high or too quickly, this can easily reverse just as fast. The result can be more ups and downs (volatility) in the value of a portfolio, and even threaten any wealth that might have already built up.

An obvious example has been the excitement surrounding technology and artificial intelligence (AI), where a handful of big technology companies have dominated both the equity market and the headlines. This sort of concentration is the antithesis of the diversification investors might seek from global equities. Not only does it leave markets vulnerable, but investors can end up holding portfolios that are heavily skewed to a particular area of the market or a single investment theme or idea.

A deliberately different investment approach

With this in mind, it’s important to seek balance, value and diversification in a global equity portfolio. This requires standing aside from the crowd. Given the global remit, our investment managers have the freedom to steer towards the best ideas wherever they arise. We deliberately combine opportunities across the world, to create a selective and diversified portfolio of 40-60 of our best, differentiated ideas.

Rather than being driven by specific countries, we take a flexible, stock-picking approach to investing. We avoid the most expensive parts of the market – those stocks trading at higher levels and ones where we consider there to be limited potential for future growth.

Our global team of equity experts prides itself on viewing the market differently and invest, with flexibility, across three types of holdings. Firstly, the core of the portfolio (70% upwards) is made up of companies with a strong track record of consistently growing their dividends over time. We balance this with a smaller number of companies (up to 20%) that may pay little or no dividend today, but which demonstrate the ability to reinvest in the company’s future with a clear path to scalable growth. Finally, we may invest up to 10% of the portfolio in companies facing temporary challenges, but which have credible plans to restore their dividends. This combination of holdings allows us to provide balance to a genuinely differentiated portfolio.

When it comes to research, we focus on the financial strength of companies, closely analysing areas such as the quality of the company’s accounting, balance sheet and cash flow, management incentives, and the sustainability of dividends, among many others. We use our own detailed financial models and embed strong risk management into every stage of the analysis process, which helps us ensure the portfolio is not too heavily skewed to any particular country, sector or theme.

How the investment trust structure strengthens the strategy

The unique structure of an investment trust offers key advantages over more traditional investments such as open-ended investment companies (OEICs) and unit trusts. We are not forced to sell holdings when stock markets are stressed or volatile , as an investment trust structure lets us stay invested in our best ideas. The structure also allows us to stockpile income in prosperous times and draw on it in the fallow, enabling us to deliver a consistency of income to our investors.

In addition, investment trusts provide the added flexibility of being able to borrow (known as gearing). While this may introduce more short-term volatility, it means we can take better advantage of investment opportunities where we see the potential for long-term returns. And unlike other investment vehicles, an investment trust is a company that is overseen by (and is accountable to) an independent Board of Directors. Our investors benefit from the certainty that their portfolio is being managed in their best interests as a shareholder.

What investors in IGET can expect

In a world where many investors are focused on the same narrow part of the market, and when global equity funds look increasingly alike, the Invesco Global Equity Income Investment Trust offers something deliberately different.

Through a disciplined approach, we seek to provide an attractive level of predictable income and capital appreciation over the long term, predominately through investment in a diversified portfolio of equities worldwide. It’s a proven global equity income strategy built to stand apart, aiming to stay the course through different market conditions, and which can bring genuine diversity to an investment portfolio.

To find out where our fund managers are finding opportunities in 2026, watch the Q1 update here.

Invesco Global Equity Income Trust plc

The Invesco Global Equity Income Investment Trust plc aims to provide an attractive level of predictable income and capital appreciation over the long term, predominately through investment in a diversified portfolio of equities worldwide. 

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