By Annabel Brodie-Smith
It’s been a tempestuous week, with the Brexit fiasco continuing in Parliament and squally storm Gareth adding to the drama. In Oxfordshire, hot chocolate has been necessary as I have attempted to explain to the boys (aged 8 and 11) what a no deal Brexit and extending Article 50 might mean.
But contrarian investors might like to know that UK shares are the cheapest they’ve been in 30 years according to Simon Gergel, manager of Merchants Trust. Can you believe Spain, Turkey and Russia are the only major markets trading at lower valuations? And income seekers might like to hear from Sue Noffke of Schroder Income Growth that over 30 years, the average UK dividend yield relative to the rest of the world has only been higher at the height of the tech bubble bursting and the 1991 recession.
It’s well worth reading our release to hear from Sue and Simon and other managers including Temple Bar’s Alastair Mundy and Lowland’s Laura Foll on unloved UK shares, Brexit and whether it’s an attractive entry point for investors seeking value. After a decade of strong performance from growth strategies, is it time for value investing to come back into favour? Watch our videos of Sue Noffke , and Simon Gergel to hear their views on the UK, Brexit and how their dividend hero companies, Schroder Income Growth and Merchants Trust, have managed to increase their dividends for 23 and 36 years respectively.
Talking of dividend heroes, we have the latest list of those 20 investment companies that have increased their dividends consecutively every year for 20 years or longer. We hear from Job Curtis, manager of City of London, which has the longest track record of dividend rises, namely 52 years. To put Brexit into context, that’s 1967 when General de Gaulle vetoed the UK’s entry to join the EC for the second time.
Finally, our investment expert, Ian Cowie explains how investment companies maintain their dividend records and takes us through the data on the AIC’s website that allows investors to understand investment companies’ income record. His conclusion hammers home the message: “Share prices may fall without warning but decent dividends or - better still - a rising stream of income can pay us to be patient.”
The daffodils are out which means spring is on its way… Annabel Brodie-Smith Communications Director, AIC
