Income: a global opportunity

GLOBAL INCOME

Growth is scarce in most developed nations, meaning income investors need to consider global opportunities and be more selective

Traditionally UK equity income funds that invest in blue-chip companies have been the primary source of income for investors. However, the global financial crisis and the recent suspension of BP’s dividend have made savers increasingly aware of the risks of having a concentrated source of income. These risks outline the importance of global diversification. According to Capita, UK companies aggregate dividend payments fell by £10bn to £56.9bn (equivalent to a 15% cut) in 2009. Adjusted only for the loss of BP’s dividend payments, total dividend payments for this year will fall to £53....