Fund Profile

Invesco Select: UK Equity 09 November 2022


Disclosure – Non-Independent Marketing Communication

This is a non-independent marketing communication commissioned by Invesco Select: UK Equity. The report has not been prepared in accordance with legal requirements designed to promote the independence of investment research and is not subject to any prohibition on the dealing ahead of the dissemination of investment research.

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Invesco Select: UK Equity (IVPU) has been managed jointly since April 2021 by Ciaran Mallon and James Goldstone, who previously worked closely together in the UK equities team. The co-managers aim to achieve a balanced portfolio in which no one factor has an overriding influence on returns. In our view, this makes the trust a potential all-weather source of equity income – particularly given the freedom that the Dividend policy offers by enabling the managers to invest for the highest total returns possible (due to the board being prepared to contribute capital to dividends).

This is a high-conviction portfolio (typically of 40 to 50 stocks), representing the managers’ best ideas across the market capitalisation spectrum. James and Ciaran aim to use gearing fairly consistently (see the Gearing section), but this belies what we view as a relatively cautious approach to investing. Underpinning their stock-picking is a desire to identify UK-listed companies that exhibit strong or improving returns, have proven management teams and strong balance sheets, and are trading at attractive valuations.

Large UK-listed companies are well represented in the top ten holdings. However, the team believe that over the long term, smaller and younger companies should outperform large-cap stocks, and the closed-ended structure allows them to allocate a proportion of capital to opportunities in the FTSE 250 and below.

James and Ciaran’s approach to achieving balance within the portfolio will perhaps resonate even more with investors during the current market volatility and political uncertainty. For those with a long-term outlook, the current discount to NAV (see the Discount section) may add extra kerb-appeal.

Analyst's View

It is clear that James and Ciaran think as hard about constructing a balanced portfolio as they do about valuations and picking stocks. By having balance within the portfolio, the team believe that over the medium to long term they are well equipped to meet the challenges that investors face. In this way, the team hope to deliver good total returns through stock selection without being exposed to a narrow set of industry or style-specific drivers.

IVPU is differentiated from its peer group as the board’s long-standing policy of supporting dividends with capital enables the managers to balance the portfolio by investing in lower-yielding opportunities and/or mid and small caps which may have higher total returns. This makes IVPU potentially of interest as a complement to other UK equity income trusts and funds.

As we discuss in the Performance section, the early outperformance the team delivered has largely been given back since Russia invaded Ukraine. However, the team have worked hard to sift the portfolio and reposition it in light of the new reality.

IVPU’s Discount to NAV has widened dramatically over the past couple of months, as have the discounts of many other investment trusts. However, once market conditions become calmer again the fundamental attractions of IVPU may be better able to shine.. In that scenario the current discount to NAV of 12.3%, relative to the peer group’s weighted average discount of 5.6%, may seem somewhat incongruous.


  • An attractive yield from an unconstrained, balanced exposure to UK equities
  • Co-manager set-up that uses the advantages of the investment trust structure to maximise long-term returns
  • Significant discount relative to peer group average


  • UK could remain undervalued relative to peers for a protracted period
  • Gearing can exacerbate the downside (as well as enhance the upside)
  • With net assets of c. £135m, the trust has some way to go before becoming suitable for some professional wealth manager firms
Continue to Portfolio

Fund History

11 Jul 2023 Fund Analysis
IVPU’s resilient dividend and wide discount makes it stand out relative to peers…
09 Nov 2022 Fund Analysis
IVPU’s managers aim to provide a differentiated, all-weather option for equity income investors…
11 May 2022 What is an investment trust?
The ins and outs of closed-ended funds and how they can support your investments…
09 Feb 2022 Fund Analysis
A new force getting recognition in the UK Equity Income sector…
09 Feb 2022 Is it the UK’s time to shine?
IVPU offers a uniquely flexible approach to UK equities…
28 Jul 2021 Fund Analysis
IVPU’s new co-manager set up provides the best of both worlds...
16 Jun 2021 A better class of travel*
Sharing many features of a traditional family office, investment trusts offer ordinary investors a cost-effective solution to managing family wealth...
11 Mar 2021 Flash update: Invesco Select & Invesco Income Growth
With a merger of Invesco Select UK Equity shares and Invesco Income Growth, we learn that the management team is also merging….
21 Oct 2020 A closer look at gold mining companies and ESG
In this article, we hear from James Goldstone - fund manager of Keystone Investment Trust and Invesco Perpetual Select Trust: UK Equity Share Portfolio on assessing mining companies within an ESG framework...
03 Sep 2020 The unsung heroes of the stock market
Ciaran Mallon of Invesco outlines the case for the utilities sector here in the UK, which seems unconnected to the volatility created from the global COVID pandemic...
26 Aug 2020 Fund Analysis
IVI has robust revenue reserves in place, having raised its dividend each of the last 23 years…
30 Jul 2020 James Goldstone
James Goldstone manages a number of UK and pan-European equity mandates at Invesco’s Henley-on-Thames office, including Keystone Investment Trust and the UK Equity Share Portfolio of Invesco Perpetual UK Select Trust...
03 Jul 2020 Results analysis: Invesco Income Growth
Invesco Income Growth (IVI) avoided some of its benchmark's losses and shareholders benefited from a closing discount...
24 Jun 2020 Ciaran Mallon
An Invesco veteran, Ciaran runs assets of around £10bn including Invesco Income Growth Trust...
15 Jun 2020 Investment Trust outlook
As the scale of the Covid-19 pandemic unfolds, James Goldstone explains his investment approach, what it means for markets, the companies he owns in his investment trusts, and how they are positioned for what may lie ahead...
08 Jun 2020 Kepler Rated: Invesco Income Growth
IVI has grown its dividends for 24 consecutive years with a strong emphasis on dividend sustainability...
23 Apr 2020 Sucker punch
Two of our analysts debate the merits of equity income and alternative income trusts at this point in time...
15 Apr 2020 Hold fast
Investment trusts' revenue reserves could make them a vital stronghold for investors facing UK dividend cuts of as much as 47%....
23 Mar 2020 An approach to governance: creating long-term value for our clients
James Goldstone outlines why they advocate for proper and effective corporate governance and sustainable business practices within the Invesco UK Equities team...
18 Mar 2020 Fund Analysis
A well established equity income fund with a strong emphasis on the sustainability of dividends and a cautious approach to the prevailing macro environment...
17 Mar 2020 Driven by the prospects of businesses
Ciaran Mallon, UK Equites Fund Manager, describes his investment philosophy and why it’s more about picking the shares that go in the portfolio than about taking big economic views...
18 Dec 2019 The squeeze continues: how trust costs keep falling
As pressure on costs remains, we reveal which trusts have achieved the most significant reductions in 2019….
03 Oct 2019 Taking back control - the ultimate flexible fund
We examine the benefits of Invesco Perpetual Select Trust's unusual structure...
28 Aug 2019 Fund Analysis
IVPU’s returns have bounced back in 2019 thanks to a contrarian allocation to domestically-exposed UK stocks…
20 Jun 2019 Balancing risks of regulation in the UK Utilities sector
Companies backed by assets, with a history of paying dividends to shareholders? Or targets for overregulation? Ciaran Mallon, Fund Manager of Invesco Income Growth Trust plc, considers the case for regulated utilities.
26 Mar 2019 Fund Analysis
A well established equity income fund with a strong emphasis on the sustainability of dividends and a cautious approach to macro bets...
06 Feb 2019 Income for the long haul
With 'ISA season' looming we identify investment trusts which offer long-term, dependable income streams for yield-hungry investors...
13 Dec 2018 Efficiency is everything
With fee structures under increasing scrutiny, we analyse which trusts limit their costs without sacrificing standards...
05 Dec 2018 Surf's up
As rough markets drive share price volatility up, we use a proprietary statistical technique to highlight trusts which are on unusually wide discounts...
04 Dec 2018 Fund Analysis
James Goldstone aims to identify undervalued companies and take advantage of the under-pricing...
03 Oct 2018 We can be heroes
Our analysis has uncovered the trusts which have generated a solid income through thick and thin - without compromising other aspects of performance...
03 Oct 2018 Fund Analysis
Invesco Income Growth is a cautiously-managed portfolio of UK equities, which aims to produce above inflation dividend growth but also capital growth in excess of the FTSE All Share...
28 Aug 2018 Why patience is a virtue in UK equities
In a world where a single Twitter post can change the share price of a company, Invesco Perpetual's Ciaran Mallon explains why he focuses on a longer investment horizon...
26 Jul 2018 Is the UK keeping this investor awake at night?
Over a year on from taking over his UK equities trust mandates, Invesco's James Goldstone discusses his outlook for UK markets...
27 Jun 2018 A winning combination
New research from Cass Business school helps explain why closed-ended funds have outperformed their open-ended peers in the major equity sectors since 2000...
13 Jun 2018 Still waters run deep
UK equity income trusts trade at a discount to their global-equity-income-focused counterparts, yet our research suggests this could be unjustified...
23 May 2018 Fund Analysis
Positioned for a rebound in valuations in companies exposed to the unloved UK domestic economy...
23 May 2018 Backing Blighty
We consider the outlook for UK equities as they endure their Brexit induced 'darkest hour'...
05 Apr 2018 The search for discounted yield
We scour the investment trust universe for trusts offering chunky yields on a discount...
04 Apr 2018 A question of conviction
15 Mar 2018 A fund for all seasons?
We examine the Invesco Perpetual Select Trust, which allows investors to switch between four share classes to suit their aims without crystallising gains...
24 Jan 2018 Fund Analysis
A focused portfolio with a conservative approach yielding 3.7% which has increased its dividend for 20 years consecutively...
13 Sep 2017 Big Issue(rs)
We highlight the UK equity trusts that have issued and bought back the most shares over the course of 2017 so far and how these actions have affected shareholders...
02 Aug 2017 Carpe Discount…
We analyse just how much discount movements have on shareholder returns in the AIC UK All Companies sector...
29 Jun 2017 Brave new world
We find out how the outlook appears today to you, and ask the top managers in each sector, region and asset class where they see the opportunities in it...
21 Jun 2017 Fund Analysis
A differentiated investment trust that has undergone a change in a management but still offers exposure to high quality companies...
21 Jun 2017 Keystone Investment Trust
A top-performing UK equity trust that has recently undergone a change in managers...
12 Jun 2017 MAYDAY!
As the Conservative party founders, we examine the impact of last week’s disastrous election on trusts...
07 Jun 2017 Omnishambles...
Given the huge levels of political-induced uncertainty, we analyse recent drivers and themes within the UK equity market ahead of the upcoming election
11 May 2017 Video: Fixed Interest investment companies update
Invesco Perpetual fixed interest portfolio manager Rhys Davies, discusses the improving global outlook...
04 Apr 2017 VIDEO: Meet the managers...
Invesco Perpetual's Mark Barnett and four of his fellow managers discuss their approach to managing money, and their market outlook...
31 Mar 2017 Video: James Goldstone
James Goldstone, UK Equities Fund Manager at Invesco Perpetual, outlines his approach...
22 Mar 2017 The new kids on the block…
We highlight the three newest managers to grace the UK equity sectors and how they have put their own individual stamps on the portfolios they've inherited...
View all

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