Livewire has acquired Market Index, the country’s leader in free stock market data.
Find out why.

The party is over, time for a sensible approach to dividends

Livewire Exclusive

Livewire Markets

John Abernethy, Chief Investment Officer of Clime Investment Management, says investors should be taking a long-term view, focusing on companies that have the cash flows to support their dividend over the cycle. “The evidence in the market is quite clear, have a long-term growth strategy, well funded by internal cash flows, and the market will reward you. Don’t listen to short-term speculators.” For investors focussed on cash flows, he says they shouldn’t be investing in companies who must pay back bondholders before they can pay a dividend. While the banks say they don’t need to cut dividends, he thinks it’s important they start retaining profits and stop issuing hybrids and new shares. If they do nothing, they’ll end up like BHP and be forced to cut. “I don’t think banks are to provide yield to support pensioners. They’re there to grow dividends over a long period of time; not only for current shareholders, but for future shareholders.” Watch the full interview:  


1 topic

Livewire Exclusive brings you exclusive content from a wide range of leading fund managers and investment professionals.

I would like to

Only to be used for sending genuine email enquiries to the Contributor. Livewire Markets Pty Ltd reserves its right to take any legal or other appropriate action in relation to misuse of this service.

Personal Information Collection Statement
Your personal information will be passed to the Contributor and/or its authorised service provider to assist the Contributor to contact you about your investment enquiry. They are required not to use your information for any other purpose. Our privacy policy explains how we store personal information and how you may access, correct or complain about the handling of personal information.