The £1.2bn fund will move to the UK All Companies sector most likely in May, according to a statement by Rathbones.
The move comes after the fund failed to meet the IA requirement that funds yield 10% more than the FTSE All-Share over a rolling three-year period, despite the trade body having launched a consultation proposing alternative ways of classifying UK equity income funds.
“We understand the IA has to adhere to rules that are currently in place," said Rathbone Unit Trust Management chief executive Mike Webb. "But we welcome the move to consult to change the rules,” He also said Rathbones would seek to return the fund to its existing sector if possible.
"The Rathbone Income Fund is an income fund, irrespective of the sector to which it is assigned," said Stick in a statement to investors. "We continue to seek to fulfil all of the income expectations of our investors,"
"We have every intention to be as helpful and constructive as we can in our contributions to the IA’s consultation process. However, we will not change the fund’s process or focus," he added.