Thomas Moore of Edinburg-based Standard Life Investments has increased stakes in UK companies like low-cost airline EasyJet and recruitment manager Staffline Group in bid for better payouts next year, a Bloomberg report said. The investment came as the British economy is set to grow the fastest by next year since 2007. The stocks of EasyJet and Staffline Group have made a rally of over 80% so far in 2013, although it paid out less than the average payouts given by members of the FTSE All-Share Index, the report said.
In a phone interview, Moore told Bloomberg that am improving economy has compelled investors to think about which companies can grow their dividend and not about the firms that can pay them a high yield today. Moore added, "They have more peace of mind doing that with better economic momentum because it's no longer all about self help, cost cutting and surviving. You can't be lured in by a high dividend yield anymore."
The Office for Budget Responsibility forecasts a 2.4% increase in the gross domestic product of Britain next year. The agency also said that the economy will grow 1.8% in 2014.
Moore's GBP 269 million or USD 442 million UK Equity Income Unconstrained Fund has made a rally of 32% this year, outperforming the FTSE 100 nearly three times. Chicago-based research firm Morningstar Inc also said that the fund has beaten 95% of 325 similar funds in 2013. BT Group, the largest holding of Moore's fund, has also gained 61%, the report said.
Moore began to serve as the fund's manager on four years ago. He told Bloomberg, "We're looking for companies that can surprise the market on revenues, cash flow and dividends. These companies still have their best days ahead of them and tend to grow their dividends faster."
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