THE BAILLIE Gifford-run Scottish American Investment Company has announced a 3.6 per cent increase to its dividend in the 2018 year, taking its total payment for the year to 11.5p per share, writes Margaret Taylor.
It comes in spite of a challenging year for equity investing, with the value of the assets of the trust, which is managed by James Dow and Toby Ross, contracting by 2.4% on a total return basis. Its benchmark, the FTSE All-World Index, fell by 3.4% over the period.
Trust chairman Peter Moon said the dividend payment for the year would “extend the company’s record of raising its dividend to 39 consecutive years”, adding that the increase is “significantly above the annual rate of inflation of 2.1%”.
Mr Moon said that while the trust had been growing well for most of the year, volatility in the final quarter caused its investments to drop.
“For the year as a whole therefore global equities lost ground,” he said. “Concerns included the deteriorating prospects for economic growth, the effects of rising interest rates and the outlook for corporate profits, all of which were intertwined with geopolitical risk and the prospect of an escalating trade war.”
Mr Moon noted that the portfolio is biased towards investments that “maintain dividends in troubled times”.
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