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Boost in number of investment trusts paying quarterly dividend

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22/02/2017
Growing numbers of investment trusts are paying a quarterly dividend to meet investor demand for income.
Boost in number of investment trusts paying quarterly dividend

Research from trade body the Association of Investment Companies (AIC) suggests almost half of investment trusts (46%) now pay a quarterly dividend compared to 43% a year ago and just 17% in 2010.

The number of companies paying a bi-annual dividend has decreased from 30% in 2016 to 28% in 2017, while just under a quarter (23%) continue to pay an annual dividend –  the same as in 2016.

Five investment companies – Ediston Property, F&C Commercial Property, Fair Oaks Income, SME Loan and TwentyFour Select Monthly Income – pay dividends on a monthly basis.

Annabel Brodie-Smith, communications director at the AIC, said: “Investment companies have a number of income advantages, including the unique ability to hold back some of the income they receive to boost their dividends in tougher times.

“The closed-ended investment company structure also makes them particularly suitable for higher yielding illiquid assets like property and infrastructure.

“With investors still hungry for income from their investments, it’s not surprising that the number of investment companies paying quarterly dividends has increased since last year, to meet this demand.”

Click here for more on why you should consider investment trusts for income

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