Reader's Question: Looking for investment trusts that pay quarterly

I hope to retire soon and need to boost my teachers’ pension. I wish to invest in investment trusts that will produce a generous and rising income, paid quarterly. I have located some from Henderson, but it is a slow and laborious process, as I also wish to co-ordinate the payment dates to ensure a monthly source of income. Any advice on how to construct such a portfolio would be welcome.
Roger Newman, Harrogate

Jonathan Davis replies:

Firstly, you should ask your teachers’ pension scheme if you can buy an ‘added years’ entitlement. If so, that could be your best bet as it is fully tax relievable and quite secure.

I would have thought that capital preservation is equally important to you as income. Thus, I would be inclined to suggest that you look at investment trusts and open-ended investment companies (OEICs) that aim for absolute returns, for example the multi-award-winning British Empire Securities and Trust Plc.

Alternatively, MitonOptimal’s Arcturus fund is an OEIC from an award-winning investment house. Both funds will alter investments to suit investment conditions. Also look at Octopus’s Protected Venture Capital Trust, which gives 30 per cent tax relief and should provide a growing income.

My general advice for your portfolio would be not to follow trends. As the late and legendary investor Sir James Goldsmith said: ‘If you can see a bandwagon, it’s too late.’ The following have had great runs for many years: equities, bonds and commercial and residential property. Thus, for income you may only be left with cash in the short term until a pullback comes in those other asset classes, as is currently the case with property, giving you an opportunity to invest.