A Quick Check On Your FTSE 100 Dividends

Published in Investing on 12 November 2012

The iShares FTSE 100 ETF (LSE: ISF) has just declared its latest payout.

One of the most popular funds tracking the FTSE 100 (UKX), the iShares FTSE 100 (LSE: ISF) exchange-traded fund, announced its latest dividend today.

The payout confirmed aggregate dividends from Britain's 100 largest companies continue to advance following the widespread cuts seen during the banking crash. However, the current aggregate dividend from the FTSE 100 index remains a fraction below the level seen prior to the recession.

Today's 5.61p per share payout now means the iShares FTSE 100 ETF has declared dividends of 20.27p per share during the last 12 months -- up 12% on the preceding 12 months.

As the next table shows, that 20.27p figure is 6% below the iShares FTSE 100 ETF's all-time dividend peak, which was reached a few years ago:

12 months to FebruaryiShares FTSE 100 dividend (p per share)
200717.56
200819.43
200921.56
201016.07
201115.68
201218.55

Source: iShares.com/Bloomberg.

Recent dividends from the iShares FTSE 100 may have been bolstered by good results from major blue-chip shares. Indeed, members of the FTSE 100 raising their payouts of late include BT, with a 15% advance, BP, with a 12.5% dividend advance, and GlaxoSmithKline, with a 6% advance.

The possibility of better returns

While index trackers such as the iShares FTSE 100 are a great way of capturing the long-term collective power of British companies and the stock market, there are always individual shares that have better dividend records -- and could deliver better returns -- than the wider index.

Here are three quick ideas that might beat the iShares FTSE 100:

 Five-year dividend growthPriceTrailing yield
iShares FTSE 100+6%578p3.5%
Centrica+33%320p4.8%
J Sainsbury+34%349p4.6%
SSE+32%1,400p5.7%

Source: Bloomberg.

Of course, you must do your own further research before buying any individual share. While some companies may offer better payout histories than the blue-chip index, a tracker will always provide greater dividend diversification.

Nonetheless, you always have the option of building a portfolio of shares that could beat the all-round dividend progress of the FTSE 100. Indeed, one investor whose portfolio dividends have been thrashing those of the FTSE is Neil Woodford, the head of investments at Invesco Perpetual and quite possibly the City's finest dividend-devoted stock-picker.

As you can see from this table, the income from one of Mr Woodford's funds hardly buckled during the banking crash:

12 months to OctoberInvesco Perpetual Income Fund (p per share)
200746.24
200846.40
200945.17
201048.00
201148.81
201250.23

Source: Bloomberg.

What's more, Mr Woodford's longer-term dividend performance far outstrips that of the iShares FTSE 100:

 20022012Change
iShares FTSE 10012.1520.27+67%
Invesco Perpetual Income24.8150.32+103%

Source: Bloomberg.

To learn more about Mr Woodford, his dependable style of dividend investing and the shares he favours right now, this free Fool report can be requested to your inbox right now.

You never know, the blue-chip shares covered by the report could easily help your dividends outpace those of the FTSE 100 in the years ahead. Just click here to download your copy of the Neil Woodford report today.

> Maynard does not own any share mentioned in this article.

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Comments

The opinions expressed here are those of the individual writers and are not representative of The Motley Fool. If you spot any comments that are unsuitable hit the flag to alert our moderators.

MunroMan 12 Nov 2012 , 12:27pm

Over the last five years this ETF has delivered a net return of -10.66%.
The actual index measured by total return has risen 7.9%.

Has anyone asked why?

TMFTigger 12 Nov 2012 , 1:40pm

Where do those figures come from Rob? The iShares site reckons the difference is around 2%, while Trustnet has a 3% gap.
http://uk.ishares.com/en/rc/products/ISF/performance

ScillyFool 12 Nov 2012 , 2:53pm

How much is Mr. Woodford paying you for this advertorial?

MunroMan 12 Nov 2012 , 4:07pm

Stuart, data from Bloomberg. That divergence does look odd.
Will check.

ellbo 12 Nov 2012 , 4:50pm

I love this site, there's so much useful stuff but the Neil Woodford line and link at the bottom of every single post is extremely OTT.

giveaholic 12 Nov 2012 , 7:06pm

Has Neil Woodford bought Motley Fool?

SevenPillars 13 Nov 2012 , 8:51am

I agree on all the Neil Woodford comments here, the Motley Fool should really come clean on why he gets a mention at the end of many articles. Often it is no real relevance to what has been written. If he's paying then readers should be told.

MunroMan 13 Nov 2012 , 2:34pm

Stuart, Schoolboy error, our series tracked the capital return not the TR.

ANuvver 14 Nov 2012 , 11:02am

Essex:

We all do it! A propos another schoolboy error that still catches me out from time to time, a clutch of Fooly favourites went ex-div today, so don't panic!

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