What are the best dividend opportunities in Europe?

EUROPEAN INCOME

Andrea Williams, manager of the Royal London European Equity Income fund, says strict policies on capital expenditure and improving cashflows means many European companies are again offering attractive dividends.

In contrast to the UK, the European equity income sector is relatively underdeveloped. For example, the IMA UK Equity Income sector contains almost 100 funds, compared with barely a dozen European funds with an income focus. Income from FTSE 100 index constituents is very concentrated, with ten stocks paying 50% of all dividend income. This level of concentration was exposed in 2010, when Royal Bank of Scotland and BP simultaneously omitted their dividends. In contrast, the FTSE Europe ex UK index offers both different sectoral exposure and lower concentration risk, with 30% of the di...