As geopolitical tensions rise and markets remain volatile, global dividend equity funds are seeing a resurgence in investor interest — drawing $23.7 billion in the first half of 2025, the highest level in three years, according to LSEG Lipper.
Amid slowing tech performance and speculation over central bank rate cuts, investors are rotating toward stable income-generating assets, especially in high-yield sectors like energy, utilities, and real estate.
💡 Why Dividend Stocks Now?
“Dividend growth is a sign of disciplined capital allocation and confidence in long-term business prospects,”
said Steve Watson, equity portfolio manager at Capital Group.
With tariff talks potentially dragging on, dividend-paying companies offer a defensive buffer during uncertain times.
🌍 Sector & Regional Breakdown:
Top global dividend yields:
Energy: 4.75%
Real Estate: 3.7%
Utilities: 3.3%
Financials: 3.0%
Highest regional dividend yields:
Europe: 3.0%
Asia-Pacific: 2.6%
U.S.: 1.4%
📊 Fund Performance Year-to-Date:
iShares International Select Dividend ETF: +26%
Xtrackers MSCI EAFE High Dividend Yield ETF: +18%
Schwab International Dividend Equity ETF: +18%
In comparison, the MSCI World Index: +8.5%
“If rate cuts happen later this year, bond yields will drop — but dividend stocks still have upside,”
noted Chad Harmer, CIO at Harmer Wealth Management.
Bottom Line:
As interest rates peak and market risks linger, dividend-paying equities are reclaiming the spotlight. Investors seeking income and resilience may continue to fuel this rotation — especially if monetary easing arrives as expected.
