For many investors, the challenge in global equity income today is no longer simply how to generate yield. It is how to do so without increasing dependence on narrow market leadership, region-specific risks, or fragile sources of income.
Equity income strategies have historically offered a way to balance participation in equity markets with a measure of defensiveness. But recent market dynamics have complicated that role. Equity returns have become increasingly concentrated, valuations have diverged sharply across regions, and geopolitical uncertainty has introduced new sources of volatility. In this environment, traditional income approaches that rely heavily on familiar markets or headline yields can leave portfolios exposed in ways that are not always obvious.
This has shifted the focus from how much income is generated to where that income comes from and how resilient it is through different market conditions. Headline yield alone can be a misleading signal. Sustainable equity income is ultimately driven by business quality: the ability to generate cash consistently, maintain balance-sheet strength, and allocate capital with discipline. Companies that can support dividends through economic and market stress tend to share these characteristics, regardless of sector or geography.
Identifying such businesses requires a global perspective and a willingness to look beyond benchmark constraints. Dividend-paying companies are not confined to a single region or style, and valuation dispersion across markets can create meaningful differences in both risk and return potential. A flexible, global approach allows investors to diversify income sources and reduce reliance on any one market narrative at a time when leadership remains unusually narrow.
Thornburg Equity Income Builder reflects this broader way of thinking about equity income. Rather than targeting yield in isolation, the strategy focuses on high-quality businesses with durable cash flows and the capacity to generate an attractive and growing income. Portfolio construction is driven by bottom-up fundamental research, with an emphasis on valuation discipline and downside awareness.
Crucially, the strategy is not constrained by benchmark allocations. This flexibility allows regional and sector exposures to evolve as relative opportunities change, rather than anchoring the portfolio to index weightings that often reflect past market leadership rather than future potential. In a market increasingly shaped by a small group of dominant companies, this flexibility can be an important source of diversification.
Quality remains central. Businesses with stable earnings, robust balance sheets and thoughtful capital management are often better positioned to sustain dividends when conditions become more challenging. By prioritising these attributes, a global equity income portfolio can seek to deliver a more consistent income profile across market cycles, while maintaining exposure to equity upside.
For professional investors, equity income frequently plays multiple roles within portfolios: supporting cash flows, contributing to total return, and helping to diversify growth-oriented allocations. As markets continue to fragment, a global, quality-focused framework offers a way to address these objectives without over-reliance on any single region, sector or style of leadership.
In today’s environment, the key question is no longer how to maximise yield, but how to build equity income that can endure. Taking a broader, more disciplined view of where income is generated — and how it is supported — is becoming an increasingly important part of portfolio construction.
To learn more, visit Thornburg.com
Opinion by Matt Burdett, Head of Equities and Managing Director, Thornburg.
Important Information
Investments carry risks, including possible loss of principal. Additional risks may be associated with investments in emerging markets, including currency fluctuations, illiquidity, volatility, and political and economic risks. Investments in small- and mid-capitalization companies may increase the risk of greater price fluctuations. Portfolios investing in bonds have the same interest rate, inflation, and credit risks that are associated with the underlying bonds. The value of bonds will fluctuate relative to changes in interest rates, decreasing when interest rates rise. Unlike bonds, bond funds have ongoing fees and expenses. Investments in mortgage-backed securities (MBS) may bear additional risk. Investments in the Fund are not insured, nor are they bank deposits or guaranteed by a bank or any other entity. For risks materially relevant to the Fund, please read the Fund’s Annual Report or Prospectus/Supplement available at www.thornburg.com/ucits.
This does not constitute or contain an offer, solicitation, recommendation or investment advice with respect to the purchase of the Funds described herein or any security. The Fund’s shares may not be sold to citizens or residents of the United States or in any other state, country or jurisdiction where it would be unlawful to offer, solicit an offer for, or sell the shares. For information regarding the jurisdictions in which the Fund is registered or passported, please contact Thornburg at global@thornburg.com or +1.855.732.9301. Fund shares may be sold on a private placement basis depending on the jurisdiction. This should not be used or distributed in any jurisdiction, other than in those in which the Fund is authorized, where authorization for distribution is required. Thornburg is authorized by the Fund to facilitate the distribution of shares of the Fund in certain jurisdictions through dealers, referral agents, sub-distributors and other financial intermediaries. Any entity forwarding this, which is produced by Thornburg in the United States, to other parties takes full responsibility for ensuring compliance with applicable securities laws in connection with its distribution.
The Fund is a sub-fund of Thornburg Global Investment plc (“TGI”), an open-ended investment company with variable capital constituted as an umbrella fund with segregated liability between sub-funds, authorized and regulated by the Central Bank of Ireland (“CBI”) as an Undertaking for Collective Investments in Transferable Securities (“UCITS”). Authorization of TGI by the CBI is not an endorsement or guarantee by the CBI nor is the CBI responsible for the contents of any marketing material or the Fund’s prospectus, supplement or applicable Key Information Document (“KID”). Authorization by the CBI shall not constitute a warranty as to the performance of TGI and the CBI shall not be liable for the performance of TGI.
Before investing, investors should review the Fund’s full prospectus and supplement, together with the applicable KID and the most recent annual and semi-annual reports.
Copies of the Fund’s prospectus and supplement can be obtained from State Street Fund Services (Ireland) Limited, by visiting www.thornburg.com/ucits or by contacting the local paying or representative agent or local distributor in the jurisdictions in which the Fund is available for distribution, and are available in English.
The KIDs can be obtained from www.thornburg.com/ucits and are available in one of the official languages of each of the EU Member States into which the Fund has been notified for marketing under the Directive 2009/65/EC (the UCITS Directive).
In addition, a summary of investor rights is available from www.thornburg.com/ucits. The summary is available in English.
The Fund is currently notified for marketing into a number of EU Member States under the UCITS Directive. The Fund can terminate such notifications for any share class and/or the Fund at any time using the process contained in Article 93a of the UCITS Directive.
No securities commission or regulatory authority has in any way passed upon the merits of an investment in the Fund or the accuracy or adequacy of this information or the material contained herein or otherwise. Neither this or the Offering Documents have been approved in any jurisdiction where the Fund has not been registered for public offer and sale. This information is not, and under no circumstances is to be construed as the Offering Documents, a public offering or an offering memorandum as defined under applicable securities legislation. Application for shares may only be made by way of the Fund’s most recent Offering Documents.
The Fund is actively managed and is not constrained by any benchmark.
For Argentina, Bolivia, Brazil, Chile, Mexico, Peru, Uruguay: This material is for informational purposes and is intended only for Investment Professionals, as that term is defined in each jurisdiction. This information relates to a foreign Fund which is not subject to any form of local regulation or licensing. No regulator, government authority, or other entities are responsible for reviewing or verifying, and have not reviewed or verified, this information, the merits of the Fund or services represented, the offering documents, or any other documents in connection with this Fund. Interests may not be offered or sold to the public and documents relating to this Fund (as well as the information contained herein) may not be supplied to the general public for purposes of a public offering or be used in connection with any offer or subscription for sale to the public.
