With a dividend yield of 10.1%, Vodafone topped the table of single equity purchases, followed by a range of other high yielding stocks, including Legal & General (8.5%), Rio Tinto (8.3%), Aviva and Glencore, both with a 7.9% yield.
Head of markets at ii Richard Hunter noted the “investor entrenchment” represented by the presence of these stocks, adding the yield remains “well in excess of cash equivalents”.
Global dividends hit record $1.6trn in 2022
Alongside the income-paying stocks, investors continue to take a punt on more speculative bets and the potential recovery return available.
ASOS sneaked in as the eighth most bought stock on ii in May, with the stock down 31.6% year-to-date and recently relegated from the FTSE 250, while Hunter noted Aviva, Legal & General and Vodafone also offer a recovery play, having fallen 10%, 8.3% and 9.6%, respectively, according to data from MarketWatch.
Investment trusts
Investors also sought income in the closed-ended space, with four trusts yielding 5% or higher breaching the top ten: BlackRock World Mining, Greencoat UK Wind, City of London and Merchants.
One new entrant to the list in May was Fidelity European, which ii collective specialists Kyle Caldwell described as a play on the recent European rally.
Digging deeper for decent dividends
“Europe has been a star stock market performer of late, and some investors have positioned to profit in the hope the rally has plenty of legs,” he said. “[Fidelity European], managed by Sam Morse and Marcel Stotzel, has exposure to this trend among its top ten holdings through LVMH, which is made up of fashion brand Louis Vuitton and drinks companies Moët and Hennessy. Also, a top ten position is French cosmetics giant L’Oreal.”
Passive domination
In open-ended funds, passive products continue to dominate, comprising eight of the ten most bought funds throughout May.
These were typically focused on global equity exposure, while the inclusion of a developed world ex-UK product reflects the continued negative outlook UK investors hold for their home market.
Royal London Short Term Money Market held its spot in the top ten on the back of rising rates, but stalwart Fundsmith Equity continues to retain the crown of most bought fund on the platform.
