Don’t forget about foreign firms

INVESTORS in search of dividend income should not forget to look overseas.

According to research carried out by investment house Janus Henderson, international dividends paid by companies outside the UK rose by 119 per cent between 2009 and late 2018 – with Japan (158 per cent), the rest of Asia (164 per cent) and North America (153 per cent) leading the way. In total, the top 1,200 global companies paid £889 billion of dividends in the year to the end of October 2018 – £816billion of which was generated by nonUK stock market-listed companies.

Ben Lofthouse is manager of Henderson International Income, an investment trust that only invests in incomefriendly companies outside the UK. In the year to September last year, it grew its dividend by 8 per cent. He says: ‘There are benefits to including international dividends as part of an income portfolio. They include access to different industry sectors and diversification of regulatory and political risks.’ He adds that a number of leading technology and financial companies are now returning cash to shareholders through dividends. Some global investment trusts have dividend growth records stretching back 30 years. They include Alliance, Bankers, Foreign & Colonial, Scottish and Witan.