The most-popular dividend shares among global fund managers

We reveal the global income stocks the pros have the most exposure to.

Over the past decade, more investors have broadened their horizons by adding international diversification to their portfolios.

For income-seeking investors, the UK has a rich dividend heritage, but there are some drawbacks. The first is that income is highly concentrated among the biggest payers, with figures from Computershare showing that the top 15 dividend stocks are expected to account for 66% of all income payouts in 2024.  

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Another downside is that the UK market has a bias to old-economy industries and sectors, such as mining and banking, with little exposure to tech companies.

Therefore, it is the fund managers running global equity income funds who can cast their nets wider, reflecting the less-concentrated nature of global dividends.

It is a good idea to have some exposure to as many markets as possible to access the best companies. An easy way for income investors to ensure that most bases are covered is to opt for a global equity income fund.

Separately, we’ve looked under the bonnet, via Morningstar, to discover the most popular dividend-paying shares among UK fund managers, but in this article, the focus is on global equity income funds.

Data, from Morningstar to the end of June, highlights the 20 most-popular shares ranked by the sector average percentage weighting for global equity income funds.

Consumer-facing businesses, tech firms and healthcare companies dominate the table.

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How the top 20 has changed since towards end of 2023

There have been four newcomers and four exits in the table since the end of October 2023 when the data was last compiled. The newcomers are Taiwan Semiconductor (NYSE:TSM), Deutsche Boerse (XETRA:DB1), Diageo (LSE:DGE) and Schneider Electric (EURONEXT:SU).

Taiwan Semiconductor is the world’s-largest chip foundry, and makes chips designed by Nvidia. Deutsche Boerse operates the Frankfurt Stock Exchange, while Diageo is one of the world's leading producers of branded premium spirits, and Schneider Electric is a leading global supplier of electrical and industrial automation equipment. 

Losing their places in the top 20 are RELX (LSE:REL), which was 12th last time, as well as Coca-Cola (NYSE:KO),Imperial Brands (LSE:IMB) and Novo Nordisk (NYSE:NVO).

Overall, the dividend yields are notably lower than those of the 20 most-popular UK dividend shares, with the main motivation for holding some of these stocks being their growth prospects, rather than the income paid to shareholders.

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It will be interesting to see whether Meta Platforms makes it way into the rankings when the data is next re-run in around six months’ time.

In the first quarter of 2024, the technology firm made the largest contribution to US dividend growth on an underlying basis (which strips out special dividends) by paying its first-ever dividend.

Source: SharePad. Forecast dividend yield data sourced on 27 August 2024.