The 2025 line-up of ‘next generation’ trust dividend heroes

Of the investment trusts waiting in the wings to become ‘dividend heroes’, there are plenty of high-yield options.

25th March 2025 14:46

by Kyle Caldwell from interactive investor

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As reported last week, 20 investment trusts have delivered at least 20 consecutive dividend increases, with five - City of London (LSE:CTY), Bankers (LSE:BNKR), F&C Investment Trust (LSE:FCIT), Scottish Mortgage (LSE:SMT) and Henderson Smaller Companies - appearing on interactive investor’s Super 60 list of investment ideas.

However, data from the Association of Investment Companies (AIC) shows that waiting in the wings to become dividend heroes are 30 trusts that have increased their dividends for 10 or more consecutive years, but fewer than 20 years. More than half of these next generation trusts yield more than 4%.

The highest yielding next generation dividend heroes are Henderson Far East Income Ord (LSE:HFEL) (11.2% yield), Foresight Solar Ord (LSE:FSFL) (9.8%), and Chelverton UK Dividend Trust (9.2% yield).

Patria Private Equity and Foresight Solar Fund have joined the next generation of dividend heroes this year, having notched up 10 consecutive years of annual dividend increases. 

Schroder Oriental Income and BlackRock Greater Europe lead the list, both having increased their annual dividends for 18 consecutive years. They are closely followed by CQS New City High Yield Fund and Henderson Far East Income, which both have an unbroken record of 17 years of dividend increases. Two investment companies have 16 years of dividend increases: International Public Partnerships and abrdn Asian Income Fund.

Three of the trusts in the next generation list are members of the ii Super 60. They are Fidelity Special Values (LSE:FSV), TR Property (LSE:TRY), and Fidelity China Special Situations (LSE:FCSS).  

The next generation dividend heroes with the fastest five-year dividend growth per annum are Fidelity Special Values, CT Private Equity Trust and Fidelity China Special Situations. 

While high yields offer investors the prospect of higher income today, there are no guarantees that this will result in market-beating returns from a total return perspective – when both capital and income are combined. In addition, dividend growth may be higher for trusts with lower yields today.

Income-paying investment trusts have a particular attraction for investors who want a regular cash flow, because they don’t have to distribute all the income generated by their assets every year.

Investment trusts can hold back up to 15% each year, which means they can build up a “rainy day” reserve to bolster dividend payouts in leaner years. In contrast, open-ended funds must return all the income generated each year to investors.

The next generation of investment trust dividend heroes

Investment trust

AIC sector

Years of consecutive dividend increases

Dividend yield (%)

5yr dividend growth p.a. %

Schroder Oriental Income

Asia Pacific Equity Income

18

4.31

3.51

BlackRock Greater Europe

Europe

18

1.16

3.65

CQS New City High Yield Fund

Debt - Loans and Bonds

17

8.81

0.22

Henderson Far East Income

Asia Pacific Equity Income

17

11.21

1.89

International Public Partnerships

Infrastructure

16

7.66

3.04

abrdn Asian Income Fund

Asia Pacific Equity Income

16

7.31

9.30

Fidelity Special Values

UK All Companies

15

2.88

10.66

Lowland Investment Company

UK Equity Income

15

4.85

1.55

Law Debenture Corporation

UK Equity Income

15

3.73

5.20

Invesco Global Equity Income Trust

Global Equity Income

14

3.82

1.27

TR Property Investment Trust

Property Securities

14

5.31

3.07

Chelverton UK Dividend Trust

UK Equity Income

14

9.15

7.03

Aberforth Smaller Companies

UK Smaller Companies

14

3.62

6.38

Fidelity European Trust

Europe

13

2.04

7.06

North American Income Trust

North America

13

3.55

6.60

Dunedin Income Growth

UK Equity Income

13

4.76

2.01

CT Global Managed Portfolio Income

Flexible Investment

13

6.70

4.46

Fidelity China Special Situations

China / Greater China

13

2.28

10.70

CT Private Equity Trust

Private Equity

12

6.04

14.26

Mid Wynd International

Global

12

1.08

6.53

Henderson High Income Trust

UK Equity & Bond Income

12

6.24

1.58

CT UK High Income Trust

UK Equity Income

11

5.85

2.20

Mercantile Investment Trust

UK All Companies

11

3.26

3.96

ICG Enterprise Trust

Private Equity

11

3.04

8.45

Canadian General Investments

North America

11

2.57

4.56

Henderson International Income*

Global Equity Income

11

4.19

6.23

BBGI Global Infrastructure S.A.**

Infrastructure

10

6.17

3.27

RIT Capital Partners

Flexible Investment

10

1.99

2.78

Patria Private Equity

Private Equity

10

3.18

5.59

Foresight Solar Fund

Renewable Energy Infrastructure

10

9.80

3.43

Source: theaic.co.uk/Morningstar. Data as at 20/03/2025. *A merger between Henderson International Income and JPMorgan Global Growth & Income has been proposed. **A cash offer for BBGI Global Infrastructure S.A has been proposed.

These articles are provided for information purposes only.  Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties.  The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.

Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.

Related Categories

    Investment TrustsSuper 60Bonds and giltsNorth AmericaUK shares

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