What is the best way to access the US income story?

US

A change in the US dividend culture has created a burgeoning US equity income sector. The yield opportunities are clear, but is a pure play strategy the best way to access the story? Maria Merricks reports.

Despite being the largest market in the world, the US has long been dismissed by income seekers, placing it somewhat behind the curve compared to the likes of the UK’s equity income culture. A number of factors have warranted it being overlooked. The dotcom bubble of the 1990s shifted the focus from income as investors scrambled for the big growth stories, according to Henry Sanders, manager of the Aviva Investors US Equity Income fund. Add to the mix a hefty income tax on dividends of around 35% and the concept was rendered pretty inefficient. However, 2003 saw a change in the tax...