Equity income still fine strategy

Devon is presenting a seminar at Heathcote Investment Partners and The Investment Store's Perfecting Investment Portfolio conference next month on achieving sustainable yield through equities, in particular for people looking for retirement income.

Dravitzki said the seminar would focus on yield investing as an attractive style of equity exposure. He said for most equity investors, the vast majority of their return over time came from dividends paid rather than capital gain and many New Zealand investors were keen on high-yielding stocks.

Investors who adopted a strategy of investing in equities that would provide high dividends would gain a conservative equity exposure and satisfactory investment outcomes. Studies had shown yield-driven portfolios did well over the long term, he said.

In the current environment, with bond rates falling or at historically low levels, people are seeking yield to provide new income sources. Dravitzki said investors still remembered being able to get 7% or 8% by investing in bonds and were looking at equity yields as an alternative.