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Australia Ethical Income

Combining client values with a ‘sufficient income for life’.

Overview

The Martin Currie Australia Ethical Income strategy seeks to provide a high, stable and growing income stream by investing in a diversified benchmark-unaware portfolio of high-quality, income-paying securities while accommodating for client-driven ethical values.

Our income approach is premised on the philosophy that high-quality companies that have solid earnings can sustain dividends, grow income distributions to match rises in the cost of living, and are likely to be less volatile than the wider equity market. These are key attributes of what we like to call a ‘sufficient income for life’. Our approach also aims to extract the full benefit of franking credits and maximise after tax income for 0% tax payers.

Our focus on a ‘sufficient income for life’ has resulted in an Australian equity portfolio that looks very differently to both traditional equities and other income-focused approaches.

ESG research is integrated deeply into Martin Currie Australia's multi-lensed research process and we incorporate negative ethical values screening and further ESG exclusions based on client-specific requirements. Through our experience, we have found that the inclusion of a client’s own ethical values has been complementary to our focus on high-quality companies, and thus has not compromised the generation of a high, stable and growing income stream.

We have over 10 years of experience in managing income strategies through very varied market cycles, including the COVID-19 impacted 2020, and we believe this shows that our unique methodologies can provide investors with a portfolio with the attributes of ‘sufficient income for life’.

We believe that there are few peer strategies available in the market that address both income and client values in the way that the Martin Currie Australia Ethical Income strategy can.

Key Information

To provide an after-tax yield above the S&P/ASX 200 Index and to provide income stream growth above inflation

Portfolio characteristics Australia Ethical Income
Objective Income
Asset Class Equities
Style Income/Quality
Investable Universe Australian listed securities
Benchmark Benchmark unaware
Market capitalisation All cap
Country limit N/A
Sector limit Absolute 25%
Security limit Absolute 6%
Number of stocks Typically 40
Portfolio turnover Typically 25% p.a.
Forecast tracking error We do not target tracking error but total risk outcome is typically 90% of the market.
Inception  8 December 2015

  • "Investors don’t want to have to choose between their values and income – and we believe they shouldn’t have to."

Why Invest in Australia Ethical Income

Heritage

Not all equities are created equal for income

We have put both the ‘sufficient income for life’ needs and ethical values of clients at the heart of the product design for the Martin Currie Australia Ethical Income strategy

Heritage

Focus on a high, stable and growing income stream

Our benchmark unaware portfolio construction helps to avoids income shocks, hedge against rising inflation, and improve capital growth without the use of costly derivatives

Heritage

More appropriate risk profile for income investors

Maximising income and reducing the concentration in Australian equities is much more important than benchmark relative alpha and tracking-error risk measures


Investment Team

The Ethical Income strategy is co-managed by Reece Birtles and Will Baylis.

The strategy benefits from the close collaboration and deep industry expertise of wider Martin Currie Australia investment team and the broader Martin Currie global investment floor.

Reece Birtles

Reece Birtles

Job title
Chief Investment Officer, Australia
Experience
30 years
Will Baylis

Will Baylis

Job title
Portfolio Manager
Experience
38 years

Our Capabilities

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