Welcoming Dominic Younger
Dominic Younger is the new fund manager for CT UK Capital and Income Investment Trust, having joined Columbia Threadneedle in 2013. Dominic has worked with the outgoing manager, Julian Cane since 2021 on the UK equities desk.
Here, Dominic sets out his thoughts on the trust’s objectives and his outlook for UK equities in 2026.
Tell us your thoughts about becoming fund manager of CT
UK Capital and Income Investment Trust
I’m excited to be taking over as fund manager of CT UK Capital and Income Investment Trust. My predecessor, Julian Cane managed this trust for 28 years and he is a hugely valued and deeply experienced manager. Having worked with Julian since 2021 I’m pleased to say that he’ll remain a member of the UK Income desk here at Columbia Threadneedle.
My focus for the trust is similar to the other funds I manage – to invest thoughtfully and help clients achieve the investment outcomes they want for their savings. I’ll sustain the longstanding team approach we’ve established and build on Julian’s formidable legacy where he has delivered over 500% total returns while outperforming the market.
As I look to steer the Trust through its next era, Julian could hardly have set a better example of thoughtful, long-term oriented stewardship for shareholders. I’m a passionate believer in the attractions of the UK Equity Income proposition for savers. And inside the Investment Trust wrapper, I’d argue this is at its most powerful with the ability to deliver smooth dividend growth through cycles and amplify conviction in an enhanced way through gearing.
What is the Trust’s objective, focus, ambitions?
There is a lot that will remain the same. There will be no change to the overriding focus of trying to deliver for shareholders a steady and growing stream of income, while also growing their capital over time.
The trust has grown its dividends in every year since launch in 1992, including 28 years under Julian*. Aiming to extend this Dividend Hero status will naturally be a key priority. The value of that is well exemplified by this year, which has not been a vintage year for dividends in the broader UK market, with payouts lower in 2025 than 2024. By contrast we will deliver another year of growth.
In terms of how the portfolio is put together, there will be some evolution here. That is to reflect the more value / contrarian approach long-championed here on the main UK Equity Income franchise at Columbia Threadneedle.
That means for new positions, we look for names that are often out of favour with the market for a range of reasons. These are ‘Change Situations’ where, unlike when a business is just churning out 10% earnings growth year on year on year, the market can really struggle to price properly. This is where self-help is King, analysing the financial statements through cycles is critical and really getting under the skin of the characters involved is essential. That is our classic hunting ground, and right now we see a lot of opportunity to go after.
What are your expectations for UK equities in 2026 and how are you going to position the portfolio?
We are committed bottom-up investors and have no illusions that we can call the macro environment better than anyone else.
However, by zeroing in on firmer ground of valuation, we think the UK market represents a compelling place to invest relative to elsewhere. That may be hard to believe coming off the back of a record year but we remain cheap on relative, cheap in absolute, cheap on sector-adjusted and cheap vs. history.
So for a market that, despite being widely seen as a domestic concern, sources 75% of revenues from overseas commerce, that feels like an interesting starting point. We are big believers in the saying that “Price is what you pay, and value is what you get” and asset allocators looking where to place their marginal £ could do worse than remember that – whatever lies in store for global markets in 2026.
The 25% of the market that is UK domestic facing sees an economy where borrowing costs are edging down, consumer & corporate balance sheets are healthy and the multiplier effect from any substantial rebound in housing and construction activity could yet underpin a consumer-led recovery.
There are macro economic factors to consider – whether that’s fiscal, political or market-driven. But in the balance of probabilities, we feel cautiously optimistic on the set up for some of these domestically exposed names, and the broader UK market as a whole.
However things unfold, our focus in positioning the Trust’s portfolio will remain very much on the fundamentals, seeking out the contrarian opportunities and avoiding being whipsawed by momentum.
*There is no guarantee that dividends will continue to increase.
Investment risks
The value of your investments and any income from them can go down as well as up and you may not get back the original amount invested. Gearing is used for investment purposes to obtain, increase or reduce exposure to an asset, index or investment. The mention of any stocks and bonds is not a recommendation to deal. All information is sourced from Columbia Threadneedle Investments, unless otherwise stated.
Issued by Columbia Threadneedle Management Limited and approved for distribution 20/02/2026.
