Investors have pulled billions of pounds out of UK equity income funds during 2018 amid Brexit uncertainty and concerns over the sustainability of dividend payments.

But in its latest Income Study, investment firm Sanlam UK said funds in the sector are offering yields of anywhere between 3% and 7% – far higher than the return available from cash savings and bonds.

The report said the sector remains one of the most popular with assets of more than £60bn, accounting for roughly 10% of all assets under management in UK open-ended funds.

Sanlam’s study, which monitors the best and worst performing funds in the UK equity income sector every six months, shows the Slater Income fund is the best all-rounder. It has delivered a total return of 55.6% and paid £32.40 based on £100 investment over five years. It currently yields 4.4%.

The study’s ranking is based on income generated over the past five years, capital growth for each of the past five 12-month periods and volatility over the past five years.

AXA Framlington Monthly Income, which has paid out £21.80 over five years to investors, returned 66.4% and currently yields 4.3%, took second position.

Miton UK Multi Cap Income, which placed first in the last study, dropped to third. It has handed investors £19.60 over five years and returned 78.1%. It currently yields 3.9%.

Also on the list is Schroder Income Maximiser, which currently offers a yield of 6.9%, and has paid out £42.90 but returned 43.7% so appears further down the list in seventh place.