Time to focus on the non-traditional hunting grounds in UK equities

Dividend cuts have been a prominent story for the UK equity income sector over the past 12 months, albeit from fairly high levels in some instances.

Yields on offer are still attractive though, compared to those in other more classic asset classes for traditional income seeking clients. However, this in itself creates further concerns of whether the sector as a whole and larger dividend payers are being seen as bond proxies through the ongoing ‘hunt for yield', subsequently pushing up valuations with questionably hot tourist money.  UK dividends have a different dynamic to other countries in that the majority of income that comes in the form of dividends is paid by a handful of companies in specific sectors. Given the weakness ...