Dod101 wrote:I ruled out City of London because the yield seemed to me to come at too high a price in lack of capital appreciation, thus reducing the total return to unacceptable levels. See the thread on Caledonia Investments for the full story. By a decent income, I guess something over say 3.5% although with ITs I am more mindful of the total return with a good dividend as a bit of a bonus.
Were I truly looking for a better alternative to HYP as per the title to this thread I think it would be difficult.
Dod
That doesn't bother me too much, especially for something to replace HYP. The capital needs to increase, but a decent yield and increasing income are the criteria I look at, as with HYP. In CTY's case the capital appreciation is certainly good enough, (greater than RPI and greater than my HYP) and the yield of around 4% gives me the income I need to live off.
Like my HYP, I do not intend to realise the capital so this aspect can take a back seat. TR is nice to have, but not if a HYP substitute, or annuity substitute is your game.
I note Dod's priority is the opposite way round, with the income being a bit of a bonus - which is fair enough, whereas the question relatied to the search for something more like a HYP. Of course, there isnt anything available as a direct HYP substitute, but the results from CTY certainly commend themselves in this role, even though the method is rather different.
Many of the shares held are in common with HYP, though in different proportions.