An expected famine of dividends from beleaguered UK companies has seen investors push their money into investment trusts with large revenue reserves that should be able to maintain pay-outs over the coming months.

Much of it has landed in the UK income & growth sector, whose members aim to provide dividend and capital growth, where the average discount, the gap between a trust's share price and the value of the underlying portfolio, has narrowed sharply to around 1.8% as investors snap up shares. A year ago the weighted average discount was 7.6%.

John Newlands, head of investment trust research at Brewin Dolphin, said: "People are seeing a tangible and sizeable dividend as a bit of a bedrock in uncertain times. A number of these trusts also have good revenue reserves so that even though they have lost some of their income they can make up the difference next year and perhaps even grow it a bit."

Simon Elliot, head of investment trust research at Winterflood Securities, added: "The net yield on these trusts on a historic basis is 5.8% at the moment.

"That is significant when you have interest rates coming down and people are thinking about where they get their yield from."

The revenue reserves held by these trusts has come under scrutiny because they could use them to keep pay-outs high for a period, even if the companies they invest in cut dividends.

Unlike most funds, investment trusts can hoard up to 15% of the dividends they receive from the companies they invest in.

Among the trusts with the highest reserves are several with Scottish links. For instance Dunedin Income Growth, run by Stewart Methven and David Boyle of Aberdeen Asset Management, paid out 10p per share last year but has the equivalent of 14.9p per share in reserves.

Edinburgh Investment Trust, now run by Neil Woodford of Invesco Perpetual, has revenue reserves of £57.6m while last year's dividend cost it £39.6m.

Figures from analyst Winterflood Securities show that other trusts in the sector with revenue reserves equivalent to more than a year of dividends include Standard Life Equity Income Trust run by Karen Robertson, City of London, Finsbury Growth & Income, Invesco Income Growth, Lowland, Merchants, Perpetual Income & Growth and Schroder Income Growth.

Elliot said: "After three or four years of dividend growth we have a number of companies sitting on decent revenue reserves. That gives you a little bit of comfort that in the next year or two they should be able to weather a fall in their dividends."

This has become an increasing concern for investors because it is becoming harder for trust managers to find attractive companies that are paying substantial dividends. Many banks, traditionally the mainstays of the income yielding universe, have been forbidden from paying dividends under the terms of their government bailout. Other companies are likely to trim pay-outs as the economy falters.

One difficulty for investors now is finding investment trusts that are not overvalued.

Some, such as Merchants Trust, run by Allianz Global Investors, are so popular that their shares are trading at a premium to net asset value.

Alan Brierley, head of investment company research at Collins Stewart, this week warned that the share prices of many investment trusts, particularly those in the income & growth sector, could be viewed as high if markets deteriorated further.

But Newlands said: "There are still some patches of value there."

Among the trusts he highlighted were Standard Life Equity Income, trading on a 9.2% discount, and Dunedin Income Growth trading at around 5.6%.