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Best Global Income Funds UK – Invest with Zero Fees

With the increasingly globalised nature of today’s world, it has become easier than ever to gain exposure to equity and bond markets worldwide. One of the most efficient and cost-effective ways to invest in these markets, and gain a passive income stream in the process, is through global income funds.

This guide will review the Best Global Income Funds UK for 2021, providing you with all you need to know to make an effective investment decision.

Best Global Income Funds UK List

Found below are ten of the best global income funds UK that you can invest in today. In the section that follows, we will analyse each fund individually, highlighting past performance and providing insight into their key elements.

  1. iShares JP Morgan USD Emerging Markets Bond ETF – Overall Best Global Income Fund UK – Invest Now
  2. Sequoia Economic Infrastructure Income Fund – Top Global Income Fund UK – Invest Now
  3. iShares Asia Pacific Dividend UCITS ETF – Best Global Income Fund UK for the Asian Market – Invest Now
  4. Vanguard FTSE Developed Market ETF – Most Cost-Effective Global Income Fund UK
  5. Artemis Global Income Fund – Best Global Income Fund UK for Capital Growth
  6. BNY Mellon Global Income Fund – Best Global Income Fund UK for Long-Term Investing
  7. Vanguard Global Equity Income Fund – Best Global Income Fund UK for Equity Investing
  8. Fidelity Global Multi-Asset Income Fund – Best Global Income Fund UK for Dividend Yields
  9. M&G Global Dividend – Best Global Income Fund UK for High Returns
  10. BlackRock Global Income Fund – Best Global Income Fund UK for Passive Income

Best Global Income Fund to Invest in Reviewed

When investing in a global income fund, you must consider all of the various factors that represent an effective investment, such as prior performance, fund composition, and the regions the fund invests in. Researching these areas is vital when deciding on the best investment funds, as it allows you to choose an asset that is applicable to your current situation.

In the section below, we discuss each on the ten best global income funds for 2021, providing you with all you need to know in order to make an effective investment decision.

1. iShares JP Morgan USD Emerging Markets Bond ETF – Overall Best Global Income Fund UK

First up on our list of the best global income funds UK is the iShares JP Morgan USD Emerging Markets Bond ETF. This fund is made up of 554 USD-denominated bonds based in a range of countries. These countries include Mexico, Indonesia, Saudi Arabia, Qatar, and more. Through these bond investments, the fund aims to generate a high yield for investors.

iShares JP Morgan USD Emerging Markets Bond ETF

In terms of income, the iShares JP Morgan USD Emerging Markets Bond ETF offers a healthy yield of 4.05% to investors, enabling them to receive a decent passive income stream. On top of this, the fund has also generated positive returns for investors in recent years, making 15.57% in 2019 and 5.48% in 2020. The combination of a solid yield with consistent annual returns makes this one of our favourite global income funds for 2021.

67% of retail investor accounts lose money when trading CFDs with this provider.

2. Sequoia Economic Infrastructure Income Fund – Best Global Income Fund UK for Risk-Adjusted Returns

The Sequoia Economic Infrastructure Income Fund is a fantastic option if you are looking for healthy risk-adjusted returns due to the type of assets it invests in. This fund invests in a range of superior and subordinated debt instruments based on economic infrastructure. Put simply, these instruments provide funding for large infrastructure projects and, in turn, provide a steady cash flow to investors.

Sequoia Economic Infrastructure Income Fund

What this means for investors in this income fund is that they can expect a consistent yield that produces solid current income payments. The fund currently pays a high yield of 6.01% to investors, meaning that if you invested £1000, you could expect to receive £61 in payments across the year. Furthermore, you can even invest in this fund commission-free if you use eToro – meaning more of the profits are yours to keep.

67% of retail investor accounts lose money when trading CFDs with this provider.

3. iShares Asia Pacific Dividend UCITS ETF – Best Global Income Fund UK for Exposure to the Asian Market

If you are looking for a global income fund that allows you to gain exposure to the Asian market, look no further. The iShares Asia Pacific Dividend UCITS ETF invests in 50 of the highest dividend-paying stocks located within a selection of Asian stock markets, including Japan, Hong Kong, and China. Through these investments, the fund aims to benefit from dividend growth over the medium term, providing investors with a solid income stream.

iShares Asia Pacific Dividend UCITS ETF

With a generous yield of 2.75%, this fund offers a good way for investors to place their capital and earn an annual return that beats most ISA’s and other similar investments. On top of this, the iShares Asia Pacific Dividend UCITS ETF has also done reasonably well in terms of performance; the fund has returned an average of 4.57% annually over the last five years. With an expense ratio of 0.59%, this fund also provides a cost-effective way to invest in the Asian marketplace.

67% of retail investor accounts lose money when trading CFDs with this provider.

4. Vanguard FTSE Developed Market ETF – Most Cost-Effective Global Income Fund UK

The Vanguard FTSE Developed Market ETF seeks to track the FTSE Developed All Cap ex US Index’s performance, which is an index comprised of high-quality non-US companies around the world that are located in developed countries. This Vanguard fund is one of our favourites due to how inexpensive it is to hold – with an expense ratio of only 0.05% per year, it is one of the most cost-effective funds on our list. So, if you invested £1000 in this fund, you’d only have to pay £5 per year in fees!

Vanguard FTSE Developed Market ETF

Offering a price yield of 2.01%, this fund also allows investors to earn passive income paid quarterly. What’s more, you can even generate above-average capital growth with this fund; looking at 2019 and 2020, the Vanguard FTSE Developed Market ETF produced returns of 22.08% and 10.29%, respectively. These impressive returns, combined with the solid yield and low cost, make this one of the top-performing global equity income funds.

67% of retail investor accounts lose money when trading CFDs with this provider.

5. Artemis Global Income Fund – Best Global Income Fund UK for Capital Growth

Through investment in 60-80 of the world’s most attractive high dividend-paying stocks, located in various countries worldwide, the Artemis Global Income Fund seeks to maximise investors’ income stream over a period of 5-years. The fund aims to do this through a combination of UK equity income and capital growth – almost like a 2-for-1 deal! By holding quality companies operating in various sectors such as financials, materials, and IT, you also get access to a diversified asset with this fund.

Artemis Global Income Fund

Offering an attractive price yield of 3.17%, this fund rivals the other best global income funds UK in terms of passive income. Furthermore, this fund has only produced a negative return once in the past five years, even making a small positive return in 2020 during the Coronavirus pandemic lockdown. If you’re in the market for capital growth whilst generating some passive income on the side, the Artemis Global Income Fund could be a great option for you.

67% of retail investor accounts lose money when trading CFDs with this provider.

6. BNY Mellon Global Income Fund – Best Global Income Fund UK for Long-Term Investing

If you are looking to place your capital in a fund for a period of years, then the BNY Mellon Global Income is an option worth considering. This fund offers investors a yield of 2.61%, spread across quarterly payments. Furthermore, through investments in companies that are expected to keep going through times of uncertainty, this fund aims to provide investors with consistent returns over the long term.

NY Mellon Global Income Fund 

With investments in smaller companies operating in Switzerland, South Korea, and Germany, the BNY Mellon Global Income Fund offers a practical way to gain exposure to these markets without having to build your own portfolio of equities. Furthermore, this fund has performed exceptionally in the past year, returning over 28% to investors – way more than the FTSE 100. If you are looking for a fund to invest in the long-term, this is one of the best global income funds UK to do so.

67% of retail investor accounts lose money when trading CFDs with this provider.

7. Vanguard Global Equity Income Fund – Best Global Income Fund for Equity Investing

One of the best global income equity funds available in the market right now is the Vanguard Global Equity Income Fund. Investing in a selection of 132 stocks, this fund aims to provide an annual income that exceeds its benchmark index, the FTSE Developed Index. This fund invests in companies based in a wide range of countries, including Japan, France, and Canada.

Vanguard FTSE Developed Market ETF

Offering investors a yield of 2.79% per year, this fund provides an income stream that is far higher than what you could expect to receive in a savings account. Furthermore, Vanguard is often known for its cost-effective offerings, and this fund is no different – it has an expense ratio of only 0.48%, making it one of the most economical funds on this list.

67% of retail investor accounts lose money when trading CFDs with this provider.

8. Fidelity Global Multi-Asset Income Fund – Best Global Income Fund UK for Dividend Yields

If you are looking for a fund offering one of the highest dividend yields, this is a good option. The Fidelity Global Multi-Asset Income Fund provides a yield of 4.34% to investors, making it one of the best global income funds for dividend yields. To give an example, if you invested £1000 into this fund, you could expect to receive £43.40 per year in distributions!

Fidelity Global Multi-Asset Income Fund

This fund predominantly invests in the European and Asian markets, holding equities from several sectors, including financial services, healthcare, and technology. This fund has proved an effective investment in terms of performance; it has returned an average of 6.34% per year over the last five years. So, if you’re looking for a fund paying a solid level of current income, this might be a fantastic option for you.

67% of retail investor accounts lose money when trading CFDs with this provider.

9. M&G Global Dividend – Best Global Income Fund UK for High Returns

Although the best global income funds UK tend to focus more on current income than annual returns, there are some funds out there that try to do both. One of them is the M&G Global Dividend, which aims to provide high returns for investors along with a solid passive income stream. In terms of the latter, it currently offers an attractive yield of 2.27% per year, distributed annually.

M&G Global Dividend

Looking at performance, the M&G Global Dividend has done exceptionally well recently, producing an incredible 51.42% return for investors over the past year alone. However, it is worth noting that this fund has made a negative return in two of the past five years, highlighting its high level of volatility. If you are on the more risk-seeking end of the spectrum and are happy to take on additional risk to potentially make high returns, this fund may be a good option for you.

67% of retail investor accounts lose money when trading CFDs with this provider.

10. BlackRock Global Income Fund – Best Global Income Fund UK for Passive Income

To round off our list, the final fund we will discuss is the BlackRock Global Income Fund. By investing in 50 stocks worldwide, this fund aims to provide investors with a consistent price yield that delivers a passive income stream. It currently offers a yield of 3.01% per year to investors, spread across quarterly payments.

BlackRock Global Income Fund

This fund generates passive income through investments in dividend-paying equities located in many countries, including France, Spain, and Canada. What’s more, it is inherently diversified in terms of the sector too, holding assets in industries such as Pharmaceuticals, Aerospace, and Software. So, if you are looking for a diversified fund that provides consistent passive income, the BlackRock Global Income Fund might be worth checking out.

67% of retail investor accounts lose money when trading CFDs with this provider.

What are Global Income Funds?

Global income funds are a specific type of mutual fund that place greater emphasis on investing in assets that provide a stream of current income to investors. This income tends to come through either dividend payments or interest payouts. Furthermore, these cash flows can occur in various frequencies, such as monthly, quarterly, or annually.

The critical distinction between global income funds and other types of funds is that global income funds focus on overseas investments. For example, if there was an income fund domiciled in the UK, and the assets it invested in were located in the Asian market, then it could be classed as a global income fund. This focus on investing in assets located in various countries allows global income funds to offer excellent diversification levels to investors.

best global income funds UK

In terms of these assets, they tend to fall into two main categories – equities and bonds. Equities are the shares of a company and can be purchased through various exchanges. Some of these equities are known as dividend-paying equities, which means they provide a regular dividend to investors. This dividend payment comes from the company’s profits; so, although the company can provide a steady cash flow to investors, it leaves them with less capital to reinvest into the business.

The second main category of asset that global income funds invest in bonds. Bonds are a type of fixed income asset that provides a stream of income for investors through periodic interest payments. There are various types of bonds, such as investment-grade bonds and municipal bonds, each with its own risk profile.

Through the fund manager’s intelligent investment in the best dividend stocks and bonds, global income funds can produce a passive income stream for investors. This income stream can be calculated through the fund’s yield, which is presented as a percentage of your investment size. So, if you had a £5000 investment in a fund that had a yield of 5%, you would receive £250 in income payments each year (minus any costs associated with the fund).

Why Invest in Global Income Funds?

Global income funds represent one of the best ways to invest money for a variety of investor types. This section will look at three of the main reasons people consider global income funds a good investment.

Generates a Passive Income Stream

One of the most significant benefits of investing in a global income fund is that it provides access to a passive income stream in a cost-effective manner. An investor can receive a regular cash flow through dividend and interest payments, which is distributed either monthly, quarterly, or annually, depending on the specific fund.

Creating a passive income stream through the equity income sector is an attractive prospect for many investors. These income payments would be added to your broker account whenever they occur, at which point you can withdraw them or reinvest them as you see fit.

Diversification

Another huge benefit from investing in global income funds is the diversification aspect. Diversification is crucial when it comes to optimising the risk/return profile of your portfolio. If you held a portfolio of assets all located in the UK, and then the UK market suffered a severe downturn (for example, due to Brexit), the chances are that most of your assets would experience a price decline. However, if you held a portfolio that was diversified across various regions and asset classes, this downturn in the UK market would not affect your portfolio’s performance as much.

Due to the nature of global income funds, they offer an easy way to add a layer of diversification to your portfolio, as the assets they invest in are typically located overseas and can therefore help to diversify your portfolio in a geographic sense. Also, these global income funds can aid in diversification through the type of asset they hold. An example of this could be if you had a portfolio of stocks and you invested in a global income fund that focused on bonds. As stocks tend to be negatively correlated with bonds, if the equity side of your portfolio suffered a dip, the bonds within the global income fund would theoretically increase in value, thereby offsetting some or all of your losses.

Potential for Capital Growth

Although the top-performing global equity income funds tend to focus on current income rather than total return, one benefit is that they often do produce capital growth for investors too. So, if you invest in global income funds, you have a chance to essentially get a ‘2-for-1’ deal of both capital growth and a passive income stream!

global income funds returns

In the image above, you can see the potential returns that global income funds can generate when investing wisely. The image shows returns produced by the Artemis Income Fund, which is one of the best global income equity funds in the market today. You can see that, since its inception in 2010, the fund has generated cumulative returns of 224.5% for investors. So, if you’d invested £10,000 at inception, you’d now have a total of £32,450 – all whilst earning a passive income too!

Best Global Income Funds Brokers

So, you’ve checked out our list of the best global income funds UK, and you’ve decided to take the plunge and invest. In that case, the next step involves researching and choosing a trustworthy broker or investment app to make your investment with. With so many options to choose from, this can be a daunting prospect.

But not to worry! In this section of the guide, we will discuss two of the brokers we recommend when it comes to investing in global income funds, providing you with the vital information you need to know when choosing the best stock broker

1. eToro – Overall Best Global Income Fund Broker in the UK

etoro logo

If you’re looking for a reliable and cost-effective broker to invest in the best global equity income funds with, we recommend eToro. With over 20million customers, eToro is the favourite broker of investors across the globe thanks to its attractive fee structure and vast product selection. What’s more, eToro is regulated by the Financial Conduct Authority (FCA), meaning they offer the highest levels of security when it comes to your

money.

67% of retail investor accounts lose money when trading CFDs with this provider.

As mentioned, eToro is considered one of the best brokers when it comes to cost-effectiveness, and for a good reason. eToro operates under a 0% commission structure, which means you do not have to pay any fees when making your investment. Often, commissions can range between 1-3% of your position size – so the fact that eToro does not charge this means you can save huge amounts on fees in the long run. The only fee you will need to pay when investing in global income funds is the fund provider’s expense ratio.

Another reason we recommend using eToro for your global income fund investment activities is the fact that their account opening and deposit process is quick and easy. You can open an account in minutes, and this can all be completed online. Also, any deposits you make are completely free and can be achieved using your credit/debit card, bank transfer, or even an e-wallet.

etoro invest in ETFs

Finally, if you’re looking to invest in other assets in addition to a global income fund, eToro has a vast selection to choose from. With over 2000 stocks available to trade, along with a wide range of commodities, bonds, and even cryptocurrency, eToro is sure to have an option for everyone.

Pros:

  • Super user-friendly online trading platform
  • Invest in Global Income Funds without paying any commission or share dealing charges
  • Trade CFDs in the form of stocks, indices, commodities, forex, and more
  • 2,400+ stocks listed on the UK and international markets
  • 250+ ETFs
  • Deposit funds with a debit/credit card, e-wallet, or UK bank account
  • Ability to copy the trades of other users
  • FCA and FSCS protections

Cons:

  • Not suitable for advanced traders that like to perform technical analysis
  • No ISAs or SIPPs

67% of retail investor accounts lose money when trading CFDs with this provider.

2. Capital.com – Best Global Income Fund Broker for Leverage

new capital.com logo

Our second favourite broker behind eToro is Capital.com. Best known for its CFD trading options, Capital.com has been in operation since 2016 and is regulated by both the FCA and CySEC.

As Capital.com offers CFD trading, you will not actually own the underlying asset. Instead, you will own a contract based on the price of the underlying asset, and will payout depending on the price of that asset. So, if you invested in a global income fund CFD with Capital.com, you would own a contract based on the fund’s price.

capital.com invest in global income funds

One of the benefits of these CFDs is that Capital.com can offer leverage facilities to investors. With a leverage of up to 1:5 offered, this means that investors can boost their position size without having to deposit any additional money. To provide an example of this, if you invested £1000 in one of the best global income funds UK and chose to use 5X leverage, you can essentially transform your position size into £5000 and increase potential returns.

Finally, Capital.com makes it super easy to sign up and begin trading. With a minimum deposit of only $20 (around £14), Capital.com ensures they are accessible to both beginner traders and experienced pros. Finally, with a wide range of deposit options, including bank transfer, credit/debit card, and e-wallet, you can fund your account quickly and efficiently to trade the best global income funds.

Pros:

  • Educational app for new traders
  • Commission-free trading on Global Income Funds
  • Very competitive spreads
  • Leverage of up to 1:5 offered
  • AI assistant identifies your weak points
  • Excellent charting and analysis interface
  • £20 minimum deposit

Cons:

  • Cannot build custom trading strategies
  • CFDs only

75.26% of retail investor accounts lose money when spread betting and/or trading CFDs with this provider.

How to Invest in Global Income Funds on eToro Tutorial

Once you’ve decided on a broker, all that’s left to do is open your account and make your investment. In this section, we will provide a step-by-step guide on how to do this with FCA-regulated broker eToro, meaning you can be set up and ready to go in as little as ten minutes!

Step 1: Open your Account

First, your need to begin the account opening process. Simply head to the eToro website and click ‘Join Now’. After this, enter the required personal information and choose a username and a password.

etoro sign up

67% of retail investor accounts lose money when trading CFDs with this provider.

Step 2: Verify your ID and Address

FCA-regulated brokers such as eToro require you to verify your ID and address before you can invest. Luckily this can all be completed online and only takes a few minutes. Simply upload a copy of your ID (either a driver’s license or passport) and proof of address (a copy of a bank statement or utility bill). Once completed, eToro will then verify the documents, which usually only takes a few minutes.

Step 3: Fund your Account

The third step involves depositing money into your account. You can do this with eToro via credit/debit card, bank transfer, or various e-wallets. If you want the funds to go into your account instantly, we recommend using a credit/debit card.

Step 4: Search for your chosen Global Income Fund

Now click on the search bar at the top of the screen and type in either the fund’s name or its ticker symbol. For the purposes of this guide, we will use the iShares JP Morgan USD Emerging Markets Bond ETF as an example. Once you see the fund appear, click the ‘Trade’ button.

etoro invest in global income funds

67% of retail investor accounts lose money when trading CFDs with this provider.

Step 5: Invest in a Global Income Fund UK

The last step involves finalising your investment. In the screen that appears, enter your desired investment amount (minimum of $50). Then, double-check everything is correct and click the ‘Set Order’ button.

etoro trade global income funds

And that’s it! You’ve just completed your investment in your chosen global income fund – without paying any commissions!

eToro – Invest in Global Income Funds with 0% Commission

This guide has provided a comprehensive overview of the global income fund marketplace, discussing the various options available to you and providing direction on factors you must consider before making your investment. By investing in global equity and bond markets, these funds offer a fantastic opportunity for both retail and professional investors to earn a return on their capital and generate a passive income stream.

If you are looking to invest in a global income fund from the comfort of your own home, we recommend using FCA-regulated broker eToro. Not only do they allow you to invest commission-free, but you can also invest for as little as $50 (around £36)!

etoro logo

67% of retail investor accounts lose money when trading CFDs with this provider.

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About Connor Brooke PRO INVESTOR

Connor is a Scottish financial expert, specialising in wealth management and equity investing. Based in Glasgow, Connor writes full-time for a wide selection of financial websites, whilst also providing startup consulting to small businesses. Holding a Bachelor’s degree in Finance, and a Master’s degree in Investment Fund Management, Connor has extensive knowledge in the investing space, and has also written two theses on mutual funds and the UK market.

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