Harewood said the aim was to use the fact dividend-paying equities provide a higher yield than cash, government and investment grade corporate debt to provide investors with a reliable and stable income stream, without putting capital under undue risk.
The strategy targets a 50% reduction in long-term benchmark volatility and drawdown risk.
The Harewood Maximum Income portfolio uses an investment process and quantitative screening which has been implemented by the BNP Paribas investment team since December 2010.
Companies are selected from the universe based on their financial strength, ability to pay a high dividend and their sustainability.
The fund is listed on the London Stock Exchange and benchmarked against the Stoxx Europe Select Dividend 30 Net Return Eur Index.
Its current allocation is to 49 companies with a weighted dividend yield of 4.64% per annum and the fund has a minimum investment of £100,000.
Soobong Han, co-head of Harewood Solutions, said: “Unlike many traditional equity income strategies, we are placing a large emphasis on capital preservation. Our risk reduction process aims to halve drawdown risk and reduce portfolio volatility by a further 8% per annum.
“We believe that European high dividend paying equities currently deliver a higher yield than their US and emerging counterparts and analysts predict significant growth in European dividends in coming years. Indeed, European equities are cheaper in both absolute terms and relative to other markets.”
