Dividend or income strategies seem to be an appropriate investment strategy for long-term investors since these strategies try in general to harvest and distribute dividend yields which are above the average dividend yield of a given market. The investor can use these dividend payments either to reinvest them into their portfolio or use them as an additional stream of income. Therefore, it might be interesting to analyze how important income strategies are for European investors measured by the market share of assets under management of the respective mutual funds and ETFs compared to plain-vanilla mutual funds and ETFs investing in

The quantitative easing of central banks in the aftermath of the financial crisis (2008) and the so-called Euro crisis (2011) led to record low interest rates for corporate and government bonds all around the globe. The resulting low-income environment led investors to buy dividend stocks, as dividends (and therefore also dividend strategies/income funds) were marketed as the new source of stable income, especially as some corporates payed higher dividends on their stocks than interest for their bonds. This has changed since the COVID-19 pandemic led to a global shutdown that hit the revenue streams of listed companies, as well as

Key Highlights & Observations Fund Market Overall Assets under management in the global collective investment funds market grew US$775.8 billion (+1.9%) for May and stood at US$42.68 trillion at the end of the month. Estimated net inflows accounted for US$100.0 billion, while US$675.8 billion was added because of the positively performing markets. On a year-to-date basis assets increased US$3.55 trillion (+9.1%). Included in the overall year-to-date asset change figure were US$594.7 billion of estimated net inflows. Compared to a year ago, assets increased a considerable US$4.88 trillion (+12.9%). Included in the overall one-year asset change figure were US$1.15 trillion of

Britain’s credit boom is a cause for concern. Not for the obvious reasons: rates are low and the banking sector is sturdy. The issue lies with another big UK industry – cars. Auto finance is driving up the stock of non-mortgage debt, which includes credit cards and personal loans and hit 197 billion pounds at end-March. That’s close to the 2008 financial crisis peak, and household debt as a proportion of disposable income is rising. Since 2014, car finance has consistently been the biggest driver of annual consumer credit growth, which is now running at more than 10 percent. Unlike

Diverging fortunes across the UK imply a hike in consumer borrowing could damage Britain’s economy just as it looks to leave the European Union. After 11 percent compound growth over the 12 months to November, unsecured consumer credit stands at 192 billion pounds ($238 billion). Bank of England Chief Economist Andy Haldane played down concerns on Thursday, concentrating on a more moderate rise in mortgage debt. Historical data supports Haldane’s view – up to a point. Household debt is around 130 percent of disposable income, down from 150 percent in 2008. The lion’s share, at just over 100 percent of

Morgan Stanley is positioned for a liftoff – but timing is in the hands of the U.S. Federal Reserve. Solid trading and cost cuts left the Wall Street bank earning $1.5 billion, 62 percent higher than the same period last year. That put annualized return on equity just shy of 9 percent, the lower end of Chief Executive James Gorman’s target for 2017. Some help from America’s central-bank-cum-industry regulator could boost the ROE towards 11 percent, a figure that would rival Goldman Sachs. The Fed could, for one thing, raise interest rates. That would add extra juice to Morgan Stanley’s

Announcements of a secular rotation out of fixed income funds into equity funds are perhaps premature. Yet there is no denying we have seen renewed interest by fund investors in equity funds. Year to date through Wednesday, April 24, equity investors have injected a net $117.8 billion into fund coffers (including conventional funds and exchange-traded funds [ETFs]). However, the money appears to be new money entering the market; during the period investors have continued to pad the coffers of fixed income funds as well, injecting some $108.3 billion into taxable bond funds. Only money market funds (-$122.2 billion) have seen