Contrarian: Return of the dividend

CONTRARIAN

Fans of the humble dividend are riding high. According to Capita's latest Dividend Monitor, UK-listed companies paid out a record amount worth £23.2bn in the last quarter. This good news story is not just confined to the UK, as dividends have become progressively more important across the globe.

It is notable that investors in places as diverse as Russia, China, and Japan have been receiving steadily increasing dividend payouts as large corporates worldwide release huge amounts of hoarded cash to their long-suffering investors. Obviously it is a slightly different picture in the US, where buybacks are seemingly more important than dividends. According to the most recent FactSet report, for the last 12 months total buybacks for S&P 500 companies amounted to $394bn - an increase for the second quarter of 15% but a year-on-year decline of 11.5%. At an aggregate level, that buyba...