Even as the UK equity market has fallen sharply from favour with investors in recent years, it was universally accepted that a merit of the FTSE 100 was the prevalence of dividend-paying stocks relative to the index.
But with the yield on the UK’s blue-chip presently 3.5 per cent, considerably below that offered by many developed market government bonds, is the UK as synonymous with income investing now as was historically the case?
At the same time, two of the factors that have historically helped to boost the yield of the UK market, sterling weakness and the preference of UK chief executives to pay dividends, rather than buy back shares, have started to reverse.
Short of a very deep recession, we can be confident the biggest dividend payers in the FTSE 100 will continue to be able to pay
One of the reasons UK equities have fallen from favour with many investors was the FTSE being seen as a market stuffed full…
