‘Magnificent seven’ trusts record 50 years of annual dividend hikes

‘Dividend heroes’ have persevered through Black Monday, global financial crisis and the coronavirus pandemic


City of London and Alliance Trust are among a handful of investment companies to have increased their dividends consecutively for over 50 years.

The Association of Investment Companies (AIC) has identified 17 “dividend heroes,” trusts that have raised their annual dividend for at least 20 years in a row.

Of that number, a “magnificent seven” have increased their dividends for 50 or more years in a row, the AIC noted. They include City of London, Bankers and Alliance Trust (all on 55 years), Caledonia Investments (54 years), and BMO Global Smaller Companies and F&C Investment Trust (both on 51 years).

The latest addition to the half-century club is Brunner, which announced its 50th annual dividend increase on 16 February.

Outside the top seven, a further four trusts, such as Murray Income and Witan, have hiked dividends each year for between 40 and 49 years, while three, including Scottish Mortgage, have done so between 30 and 39 years.

The final name on the list, Aberdeen Standard Equity Income, has 21 years of consecutive dividend increases under its belt.

Return to an inflationary environment

“With markets remaining volatile and inflation rising rapidly following the heart-wrenching war in Ukraine, investors are looking for ways to protect their income,” said Annabel Brodie-Smith, communications director of the AIC.

“Investment companies’ ability to hold back up to 15% of the income they receive each year in a revenue reserve gives them an enormous advantage in delivering income to investors. This means investment companies can boost their dividends in years when income would otherwise have fallen short, something investors will be thankful for in these uncertain times.

“It’s a great achievement that we now have seven dividend heroes with at least half a century of unbroken annual dividend increases. These dividend heroes have consistently raised their dividend every year during the inflationary environment of the 1970s and through the market crashes of Black Monday, the tech bust, the financial crisis and the pandemic.”

Investment company AIC sector Consecutive years dividend increased Dividend yield (%) 5-year annualised dividend growth rate (%)
City of London UK Equity Income 55 4.97 3.74
Bankers Global 55 2.13 5.06
Alliance Trust Global 55 2.08 8.33
Caledonia Investments Flexible Investment 54 1.86 3.64
BMO Global Smaller Companies Global Smaller Companies 51 1.20 10.34
F&C Investment Trust Global 51 1.60 5.38
Brunner Global 50 2.04 4.98
JPMorgan Claverhouse UK Equity Income 49 4.49 5.81
Murray Income UK Equity Income 48 4.30 1.36
Scottish American Global Equity Income 48 2.73 3.21
Witan Global 47 2.59 8.06
Merchants Trust UK Equity Income 39 5.15 2.53
Scottish Mortgage Global 39 0.39 2.93
Value and Indexed Property Income Property – UK Commercial 34 5.47 3.22
BMO Capital & Income UK Equity Income 28 3.99 2.41
Schroder Income Growth UK Equity Income 26 4.35 3.84
Aberdeen Standard Equity Income UK Equity Income 21 6.29 6.60

Source: AIC



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