18 investment trusts for income investors

The Association of Investment Companies’ Dividend Heroes list highlights 18 trusts that have increased their dividends over the last 20 years, eight of which have done so for half a century

Ladder on Stack of Coins
(Image credit: © Getty images)

Here at MoneyWeek, we’ve long been fans of buying investment trusts for income (and just buying investment trusts in general).

Investment companies make for an attractive investment in inflationary times. Their ability to store up to 15% of the income they receive each year allows them to build up a rainy fund that they can use to pay dividends even during turbulent times.

Many investors have sought to protect their portfolios from the ravaging impact of inflation, which currently stands at 8.7%, with dividend-dealing investment companies gaining a fair degree of attention.

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In fact, there are 18 trusts that have increased their dividend over the last 20 years or more.

Eight of these have increased their dividends for over half a century, navigating the peaks and troughs of the market during this time.

“It’s remarkable that there are now eight dividend heroes with at least half a century of consecutive annual dividend increases,” says Annabel Brodie-Smith, communications director of the Association of Investment Companies (AIC).

“These dividend heroes are no strangers to difficult times, having raised their payouts to investors through the high inflation of the 1970s, recession of the 1990s and the global financial crisis in 2008,” says Brodie-Smith. “While dividends are never guaranteed, these are track records to be proud of.”

Dividend heroes

City of London Investment Trust tops the list of dividend heroes, having increased payments continuously for 57 years.

Bankers and Alliance Trust have increased their dividends over the last 56 years.

They’re followed by Caledonia Investments, which has increased its dividend for 55 years, The Global Smaller Companies Trust, 52 years, and F&C Investment Trust and Brunner, both of which have increased their dividends for the last 51 years in a row.

Swipe to scroll horizontally
Investment CompanySectorNumber of consecutive years dividend increasedDividend yield (%)
City of LondonUK Equity Income575.29
Alliance TrustGlobal562.37
Caledonia InvestmentsFlexible Investment562.02
The Global Smaller Companies TrustGlobal Smaller Companies531.65
F&C Investment TrustGlobal511.56
JPMorgan ClaverhouseUK Equity Income505.21
Murray IncomeUK Equity Income494.39
Scottish AmericanGlobal Equity Income492.68
Merchants TrustUK Equity Income415.17
Scottish MortgageGlobal410.61
Value and Indexed Property IncomeProperty – UK Commercial366.65
CT UK Capital & IncomeUK Equity Income294.15
Schroder Income GrowthUK Equity Income274.70
abrdn Equity IncomeUK Equity Income227.28
Athelney TrustUK Smaller Companies204.92

Source: AIC & Morningstar

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Nicole García Mérida

Nic studied for a BA in journalism at Cardiff University, and has an MA in magazine journalism from City University. She joined MoneyWeek in 2019.