Morningstar: Why a focus on yield 'isn't the silver bullet'

Many attractive yileds are 'illusory'

An ageing population, managing living expenses during retirement and now dividends being curtailed following the Covid-19 sell-off, mean the search for income is becoming ever more prevalent for investors around the world.

When someone's working years are behind them, deciding how to draw money from a retirement pot and/or live off the income it generates brings its own set of quandaries. Not least the potential of one day running out of money. Still, one path for retirees is to hold assets that will generate some natural income that can provide a level of distribution to cushion the expenses/income mismatch arising in their retirement. A focus on yield isn't the silver bullet Investors' need for income is understandable, but when buying a fund, investors are sometimes overly obsessed with the quoted yie...