Henderson Global Investors has launched a report analysing quarterly income across the globe.
The Henderson Global Dividend Index (HGDI) shows dividends across the globe burst through the $1 trillion mark in 2013, an increase of $310 billion on the figure paid out in 2009.
Henderson chief executive Andrew Formica (pictured) said the growing number of calls from clients on global equity income opportunities compelled the firm to launch HGDI.
‘The trillion dollar dividend is a huge milestone for equity investors and illustrates that dividends are now a vital component of investors' returns,’ he said.
'The search for income is more than just a response to rock bottom interest rates in recent years. It marks a generational shift as ageing populations must increasingly rely less on state pensions and more on their own savings to provide for retirement.’
The index highlights the following trends:
- Emerging markets doubled payouts between 2009 and 2011, but growth has since stalled
- Emerging markets now make up $1 in every $7 of global payouts
- Asia Pacific rises 79% since 2009
- Euro crisis weighs on Europe ex UK – dividends up 8% to $199.8 billion since 2009, but Europe is still second largest dividend payer after US
- Japan is up 29%, though yen devaluation has pushed the 2013 total down in dollar terms
- US rises 49% in five years, and accounts for one third of the global total
- Technology and financials grow fastest since 2009
- Top ten companies pay $1 in every $11 of global dividends
- Headline growth in 2013 slows as US special dividends are not repeated
- US dollar rises, reducing the translated value of dividends in other currencies
- Outlook for 2014 set for faster growth
Alex Crooke, head of global equity income at Henderson Global Investors, said HGDI shows why it is important not to be too dependent on UK stocks for income: ‘Over the five year period of our research, dividends provide a clear picture of the major global economic events and trends,' he said.
‘The rise of emerging markets, and their cooling, the inflation of the commodity bubble and its subsequent deflation, the eurozone crisis, and the US resurgence from the recession are all there to be seen.
He added: ‘The research also shows just how divergent the fortunes of different countries and different industries are.
‘It also shows how areas that rank low in free float terms, especially emerging markets, are actually generating large amounts on income, often because governments with big stakes mandate generous payouts’