High yield out in front over the long term

equity income

The headlines may be saying that growth is back but a look at returns over the past century shows that higher yielding companies will always perform over longer time periods

Since the peak of the markets in early 2000, equity income funds have seen a resurgence in popularity. This has been driven by strong performance and a greater emphasis on 'value' as opposed to 'growth' type stocks. While this may just seem like the latest in a series of periodical changes in the type of stock that outperforms, there appears to be a deeper, more significant underlying trend here. Over the course of any market cycle, one might reasonably expect that any stock carrying a higher than average yield would tend to have lower capital returns than average to give a similar total r...