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Saturday, 19 April 2008 12:37 |
Asian equities are traditionally associated with growth, but high quality companies with strong dividend yields are moving to centre stage, says Halbis, the active management specialist of the HSBC Group.
For investors seeking good returns amid current market volatility, the current high yield of the Asian equity markets and the availability of companies able to pay regular dividends as a result of the quality of their earnings streams, means that investors should consider investing in Asian dividend-focussed strategies.
Asian equities are trading on yields that are higher than local interest rates for the first time since July 2001 (lasting until December 2005).The current yield on the MSCI Pacific Free ex Japan index is around 2.86%, which compares favourably to Hong Kong's three-month deposit rate of 1.96%.
Ayaz Ebrahim, chief executive officer for Halbis in Asia-Pacific, says a focus on companies with payout power arising from strong cashflow or improving capital management has traditionally led to outperformance in volatile markets.
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