Post by Fletchsmile on Mar 19, 2019 10:23:43 GMT 7
======================================
UK dividends - have your cake and eat it
2018 saw the UK market post its worst performance in a decade, but look a little deeper and all is not as it seems.
Dividends rose 5.1% in the year – hitting a record £99.8bn.
Share prices can rise and fall quickly with market sentiment. But dividends are driven by profits and have tended to be more resilient.
Dividends rose 5.1% in the year – hitting a record £99.8bn.
Share prices can rise and fall quickly with market sentiment. But dividends are driven by profits and have tended to be more resilient.
The UK stock market is currently offering one of the highest historic yields in the last 30 years.
Since January 1993, there’ve been just 11 months when the FTSE All-Share’s had a higher yield than in 2019. And that was during the peak of the last financial crisis.
Since January 1993, there’ve been just 11 months when the FTSE All-Share’s had a higher yield than in 2019. And that was during the peak of the last financial crisis.
Broadly speaking, the higher the yield when you invested, the better your returns.
Based on the historical relationship, investing at today’s yields would have gained you an average return of around 172% in 10 years, for those who reinvested their dividends. Interestingly, across the 240, 10 year periods we looked at, investors only lost money on 3 occasions.
