Why it is worth looking to EMs for stable dividend payments

Projit Chatterjee, co-portfolio manager of the UBS Emerging Markets Equity Income fund, tells Joanna Faith what has helped and hindered his recent performance.

What has been the average payout ratio of MSCI EM companies over the last 10 years? Emerging markets (EMs) offer a stable dividend payout, having typically paid between 30%-50% of their earnings over the past ten years as dividends. EM companies have the ability to pay sustainable dividend payments, with low debt levels and cash on their balance sheets; having restructured following the Asian crisis in the late 1990s. In more recent times, companies within this asset class have demonstrated dividend discipline by raising their payout ratios in order to maintain consistent dividends...