DIY Investor Magazine
| August 2017
35
chance to own a high quality franchise on an attractive
valuation.
Lloyds has transformed itself from the previous
downturn into a well-capitalised bank generating good
returns and attractive cash flow.
Despite fears over pressure on margins given the low
interest rate environment, the bank continues to grow
net interest margins – the difference between the
interest it pays to its lenders (i.e. depositors) and the
interest it receives from its borrowers – while producing
excess capital.
With the management team promising the return of this
excess capital via special dividends, shareholders could
be in line for a cash return of close to 8%. Not a bad
starting point even if the UK economy slows.
HAS IT CREATED A LONGER TERM BUYING OPPORTUNITY’
IT’S IMPORTANT NOT TO THROW THE BABY OUT WITH THE
BATHWATER’
So while there are uncertainties around the UK
economy it’s important not to throw the baby out with
the bathwater. The under performance of domestics has
created good buying opportunities in some good quality
UK companies, and we hope our investments in these
areas will enable us to deliver long term performance to
our clients.
HENDERSON HIGH INCOME TRUST
The information should not be construed as investment
advice. Before entering into an investment agreement
please consult a professional investment adviser.
Past performance is not a guide to future performance.
The value of an investment and the income from it can
fall as well as rise and you may not get back the amount
originally invested.
Issued in the UK by Janus Henderson Investors. Janus
Henderson Investors is the name under which Henderson
Global Investors Limited (reg. No. 906355), Henderson
Fund Management Limited (reg. No. 2607112), Henderson
Investment Funds Limited (reg. No. 2678531), Henderson
Investment Management Limited (reg. No. 1795354), Alpha-
gen Capital Limited (reg. No. 962757), Henderson Equity
Partners Limited (reg. no.2606646), Gartmore Investment
Limited (reg. No. 1508030), (each incorporated and
registered in England and Wales with registered office at
201 Bishopsgate, London EC2M 3AE) are authorised and
regulated by the Financial Conduct Authority to provide
investment products and services.
