These 'magic seven' global stocks pay a 7.8% dividend yield on average, Berenberg says

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In the past, when the dividend yield for these seven stocks topped 7%, returns over the next 12 months reached 60% nearly every single time, the bank said.

Investors searching for income in today's volatile markets may want to look at the "magic seven" U.K. stocks identified by Berenberg. The London-listed stocks include British American Tobacco , Schroders , Rio Tinto , Aviva , British Land , Close Brothers and Legal & General . British American Tobacco and Rio Tinto are also listed on U.S. stock exchanges. Schroders, Legal & General, Aviva, and British Land are traded over-the-counter in the U.S. and Germany.

Berenberg notes that this exceeds payout peaks during the Covid-19 pandemic and global financial crisis. Historically, yields above 4.5% have preceded 12-month returns of 54% for Schroders, "with a win ratio of 98%," according to the bank. Rio Tinto The mining giant now yields 8.1% — more than double the broad U.K. market's 3.6%. Berenberg's analysis shows dividend yields above 4.5% have resulted in median returns near 30% for Rio Tinto, with a more-than-90% success rate.

 

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