The golden rules of income investing

Chris Murphy, manager of the Aviva Investors UK Equity Income fund, looks at how to turn the golden rules of income investing into a successful portfolio.

Dividend yield and dividend growth have long been proven to be the biggest drivers of total equity returns over the long term. The compounding effect from reinvested dividends can be incredibly powerful. However, while yield must be a primary objective of any income portfolio, there is more to building a successful portfolio than selecting just high-yielding names. Following four golden rules could set you on the path towards success and help avoid some of the common pitfalls that face equity income investors. Rule 1: Do not feel compelled to invest only in large caps Yes, a handful...