Why investors need to conduct dividend 'sustainability' analysis

Kirill Pyshkin, fund manager at Mirabaud Asset Management, says the recent underperformance of global high dividend stocks is unusual, so should investors be taking advantage of the buying opportunity?

The search for yield is more relevant than ever in the current low yield environment. Government bond yields have been significantly higher than the dividend yields in past but have been steadily declining over the last three decades since their peak in early 1980s. Despite the spike earlier this year, bond yields are still very low and S&P dividend is today roughly the same as the 10-year US government bond yield. In most other developed markets dividend yields are much higher than the government and even blue-chip corporate bond yields. It is necessary to pay specific attention to...