Sinking stock markets are a timely reminder of the merits of a well-grounded dividend. Investors in Phoenix Group Holdings should be able to count on the income element to lift returns, even if volatility continues to strike the share price.
Pushing through a near-4 per cent rise in the dividend to 50.8p leaves the shares offering a dividend yield of 8.6 per cent. Even in an era of climbing interest rates, that puts Phoenix in income stock territory.
The increase in the final dividend was funded 50-50 by new business and the acquisition of Sun Life of Canada UK, due to be completed in April. It comes after a pivotal change in policy a year ago to grow the dividend sustainably, rather than being reliant
