These 50%+ “AI Dividends” Could Ruin Your Retirement

by Michael Foster, Investment Strategist

What if you could squeeze, say, a 70% dividend yield from a fast-growing AI stock like NVIDIA (NVDA) or Palantir (PLTR)?

Sounds great, right?

Instead of relying just on these stocks’ prices for your profits (since dividends are, frankly, the furthest thing from their CFOs’ minds), you get their returns as high-yielding dividends.

That’s something a new breed of ETFs is promising. These funds, which are gaining in popularity, hold just one stock – usually a Palantir, Tesla (TSLA) or NVIDIA – and trade options on that one stock to deliver stated yields often way above 50%.

Does it work?

First, let me say that, as someone who has covered 8%+ yielding closed-end funds (CEFs) for over a decade, I get the sentiment behind these funds. Big income streams can create financial independence – who wouldn’t want as big of a yield as possible?

But there’s a line where a dividend goes from appealing to dangerous – and it’s well below the stated 70% distribution rate, as of this writing, on a single-stock ETF like, say, the YieldMax AI Option Income Strategy ETF (AIYY).

That’s because, what these funds’ massive yields give, their share prices can easily take away.

Consider the YieldMax AI Option Income Strategy ETF (AIYY), which aims to deliver that 70% income stream by holding C3.ai (AI), a developer of AI apps for business. As I write this, AIYY investors have seen a total return of nearly negative 50% since the start of the year.

70% Dividend Doesn’t Help AIYY Investors

With nearly half of their capital now lost in 2025 (with dividends included), those holding AIYY must be wondering what went wrong.

Let’s start with that dividend, because there’s a key thing to note here: Even though AIYY’s website says its distribution rate is 71%, it also tells us that the fund’s 30-day SEC yield is only 4.8%. This means the fund’s net investment income (which can only be calculated by a strict SEC-mandated formula and excludes options income, which can be unpredictable) is much lower than that 70% – which is the payout as a percentage of the fund’s assets.

Moreover, AIYY’s distributions keep falling, down 63% in 2025.

Huge Yield, But Shrinking Payouts

Let me clear – not all of YieldMax’s 57 ETFs are losing money this year. In fact, most are up. The best return goes to the YieldMax PLTR Option Income Strategy ETF (PLTY), with a stated 49.4% yield. This fund has returned 77.9% for 2025 and is up much more since its inception in late 2024.

PLTY Explodes Out of the Gate

So, have we found the secret to financial independence here? After all, with this 49.4% income stream, it takes only about $203,000 in upfront investment to get a six-figure income stream!

Except, well, there’s a lot of risk behind this seemingly impressive chart.

As you probably guessed from the fund name, this ETF tracks Palantir, whose stock has surged as the company wins more government contracts. If you predicted PLTR’s surge, congratulations – that’s impressive. But an investor who knew to invest in PLTR should’ve just bought that stock instead, since PLTY (in purple below) has badly lagged it.

Palantir Tramples the Single-Stock ETF That Tracks It

This problem is endemic to single-stock ETFs: These funds try to “translate” growth stocks’ gains into big dividends, but in so doing expose us to the risks of a single stock, with less upside.

Sure, the income is great when the stock is rising, but that income will shrink if the stock drops. That’s what happened to the 56.2%-yielding YieldMax MRNA Option Income Strategy ETF (MRNY), which holds Moderna (MRNA) and is down 39% in 2025 and down even more since its IPO in early 2024.

MRNY’s 40%+ Dividend Yield Can’t Save Its Stock

Anyone who bought MRNY and enjoyed the huge yields at the start of 2024 probably thought they were really on to something, as the fund’s total return rose into the spring. They then saw their fortunes reverse as the fund’s price fell.

That’s the fate I expect for the aforementioned PLTY if the stock it tracks – again, Palantir – drops. And I see that as likely, since Palantir’s forward price-to-earnings (P/E) ratio is at a stratospheric 278 as I write this.

So what are these funds for, then? To be honest, I’m not sure. As we’ve seen, investors are almost always better off just buying the underlying stocks.

What’s more, some of these ETF issuers are venturing into even riskier territory, like the recently released ” Bonk Income Blast ETF,” which doesn’t just invest in crypto, but also in “other crypto ETFs, including non-US crypto-ETFs,” according to its SEC filing.

This means investors will wind up paying the fees for this ETF, as well as fees for the ETFs it owns. Plus they’re exposing themselves to the risks of the crypto market and the risks of foreign markets – including potentially lax regulation – too.

There’s just no reason to take risks like those when you can get predictable, diversified dividends from CEFs. Sure, CEFs don’t offer the mind-blowing yields of YieldMax and its ilk. But we’ll happily take that “lower” payout – bearing in mind many CEFs yield more than 8%, if it lets us sleep peacefully at night. Moreover, we benefit from CEFs discounts to net asset value (NAV, or the value of their underlying portfolios), which hold the potential for future upside. ETFs – single stock or no – never offer us a discount.

I think you’ll agree that this is a far better deal than a 70%-yielder that’s dropped around 50% in less than a year.

Bargain Alert: These 8.2% Payers Get You BIG Dividends From AI (the Right Way)

I hate to see investors take massive risks like these when there’s a much safer way to get a high payout from the AI megatrend.

Like our approach. Right now, we’re buying 4 bargain-priced CEFs paying 8.2% on average. These stealth income plays hold smartly built, diverse portfolios of AI stocks – they’re head-and-shoulders above treacherous “one-stock” plays like PLTY.

Critically, these 4 funds hold shares of both AI developers and companies putting this breakthrough tech to work in their everyday businesses. That’s critical because it gives us a piece of the action as AI slashes these companies’ costs, boosts their sales and helps them get more out of each and every employee.

And because they’re overlooked bargains, these 8.2%-paying funds let us buy their portfolios for less than we could if we bought each of their holdings individually.

These were the most-bought active and passive funds on Interactive Investor during September:

Header Cell – Column 0	Active Open-Ended Fund	Index Fund or ETF
1	Royal London Short Term Money Market Fund | Acc	iShares Physical Gold
2	Artemis Global Income | Acc	Vanguard LifeStrategy 80% Equity
3	Ranmore Global Equity Institutional	L&G Global Technology Index Trust
4	Jupiter Gold & Silver	Vanguard S&P 500 UCITS ETF | Acc
5	Royal London Short Term Money Market Fund | Dis	Vanguard S&P 500 UCITS ETF | Dis
6	Orbis OEIC Global Balanced	HSBC FTSE All World Index
7	Artemis Global Income | Dis	Vanguard Global All Cap Index
8	Artemis SmartGARP European Equity	iShares Physical Silver
9	Ninety One Global Gold	Vanguard LifeStrategy 100% Equity
10	Vanguard Sterling Short-Term Money Market	Vanguard LifeStrategy 60% Equity

^{Source: Interactive Investor.}

The gold rush is especially noticeable in the top funds and ETFs list, with iShares Physical Gold ETC (LON:SGLN) jumping from third to first place in the list of top passive funds and Jupiter Gold and Silver Fund jumping from sixth to fourth.

“In September, a key trend was increased demand for precious metals,” said Caldwell. “There were two new entries: Ninety One Global Gold and iShares Physical Silver (LON:SSLN).”

September’s top investment trusts for DIY investors

These were the most-bought investment trusts among DIY investors on Interactive Investor during September:

Header Cell – Column	Investment Trust
1	Scottish Mortgage
2	Greencoat UK Wind
3	City of London
4	Polar Capital Technology
5	Temple Bar
6	Fidelity China Special Situations
7	JPMorgan Global Growth & Income
8	F&C Investment Trust
9	International Public Partnership
10	Murray International

^{Source: Interactive Investor.}

Technology investment trusts like Polar Capital Technology and Scottish Mortgage (LON:SMT) remain popular choices, but there are signs that DIY investors are looking less exclusively at growth-oriented investment trusts.

“Another trend gaining greater prominence is investors turning to funds that have a value style,” said Caldwell. Murray International (LON:MYI) is a new entrant to the table that reflects this value focus.

“This suggests that some investors are seeking greater diversification in their portfolios, perhaps mindful of the concentration risk attached to the US stock market,” said Caldwell.

The Analys

The best stocks in Britain’s diverse energy sector

Former City analyst Robin Hardy assesses the opportunities among energy delivery companies

Published on October 1, 2025

by Robin Hardy

The UK-listed energy is a large and diverse collection of both pure businesses and collective investment funds focusing on one or more points on the energy delivery spectrum. It encompasses a wide set of aspects of the energy market from upstream to downstream, from clean to dirty, from new technology to old, and from generation to supply. There are businesses offering potentially rapid growth through to plodding, near utilities and also some of the UK market’s larger dividend yielders. That means investors in this sector are capable of generating a diverse range of earnings streams that should suit pretty much any approach or ESG standpoint. While the sector is large by market cap terms, that value is heavily skewed to a handful of some of the UK’s largest stocks. 

We start with a ‘view from 10,000 feet’ of how this diverse sector fits together. 

The oil & gas sector

This remains, by some margin, the largest part of the energy sector due to FTSE giants Shell (SHEL) and BP (BP) (combined market cap >£200bn). Understandably this remains a problematic area for many investors due to its negative environmental credentials, although this is likely to be where the greatest investment in green energy will be found. These businesses are looking to salve their reputation and avoid future punitive taxation and they have immense free cash flow to slowly move their business models away from fossil fuels. We have written in this column before that perhaps the best route to clean energy is to buy dirty.

Shell’s appears the stronger and more consistent approach to building a more balanced future energy profile, while BP has back-peddled: this is reflected in a different share price performance with Shell delivering the greater gains over the past five years. 

While investors may wish to focus on green energy, there is no escape from the fact that the outlook for oil demand remains strong. Even by 2050 global demand for oil is forecast to be close to 20 per cent higher than it is today: 123mn barrels per day versus 2024’s 104mn. In a less stable geopolitical climate oil prices are likely to remain volatile but relatively high, allowing for very healthy profits to still to be generated from fossil fuels. These earnings may be fairly lowly rated but they are extensive and growing. 

In the oil and related space, in addition to these large integrated businesses (upstream and downstream) we also have pure upstream businesses such as Tullow (TLW) and Harbour (HBR) through to Aim-listed exploration-only businesses such as Rockhopper (RKH), although a good number of smaller Aim-listed players have more recently de-listed from this UK’s junior index. These smaller stocks are typically riskier and more volatile in nature and most have not generated good returns for investors. 

The clean energy sector

Clean or renewable energy comes in four core variants: wind, solar, biomass and fuel cell technology. We are not counting nuclear energy here although this is technically a renewable source.

Fuel cell technology

Fuel cell technology is a clean rather than renewable energy source as it consumes and converts an input material. It is the process of turning either methane (natural gas) or hydrogen into electricity by means of hydrolysis. As this is a fully reversible process, it can also be used to store power by turning electricity into hydrogen, potentially very useful in systems such as wind where some kind of network storage/battery is ideally used to capture excess power generation. 

The problem with fuel cells is their relatively low output, often making only enough power for a single building, factory or large vehicle: this is not really a technology for network generation. The largest potential installations might run to 100MW, enough to run a single large factory at peak load. However, as power generation is moving increasingly to the micro or local scale, there is a clear space in the market for this technology.

Read more from Investors’ Chronicle

Another potential issue for fuel cells is that the production of the cleanest fuel cell fuel, hydrogen (the only byproduct is water), is not typically a clean process. Most hydrogen (around 96 per cent) is made using steam methane reforming which can release significant amounts of carbon dioxide. But green hydrogen production (using renewable energy and electrolysis) is rising steeply. 

The problem for investors with this sector is that the listed players are small: ITM Power (ITM) generates less than £50mn revenues and Ceres Power (CWR) nearer £30mn with neither yet generating positive EPS. That said, running from such a low revenue base does allow for sharp share price movements whenever a sizeable supply contract is signed, but also equally negative reactions come when delays occur, which appear common. Making money in this space is challenging. 

Renewables

Renewables is a reasonably hard sector for investing in single stocks, but there are 18 renewable energy investment trusts trading on the LSE.

Wind

There is limited scope for direct investment here with the only pure play being investment trust Greencoat UK Wind (UKW). This sector attracts the particular ire of US President Donald Trump and given the recent UN speech and the economic levers Maga likes to pull to impact policy globally, this sector may face a tough near-term future. There are also concerns about long-term operational costs and the unpredictability of generating levels. Wind (mainly offshore) in the past 12 months contributed around 30 per cent of the UK’s electricity. But investors’ options are limited, with the perhaps best routes being tangential through overseas operators, funds or the likes of turbine manufacturers. 

Solar

Again, single company investments are limited here but funds/trust abound. The largest options here are The Renewables Infrastructure Group (TRIG) which is also involved in wind, SDCL Efficiency Income (SEIT), Foresight Solar Fund (FSFL) or Bluefield Solar Income (BSIF). Share price performance in recent years has not been great but yields in all four cases are close to double digits and are generally high across this subsector. This, however, reflects some higher levels of risk, as do the material discounts to asset values.

Biomass

Biomass involves the burning of, primarily, waste or byproducts in the form of methane from food waste or – the largest and perhaps most controversial source – timber. The main player here is Drax (DRX). Drax is a single, converted coal-burning power station that now burns wood pellets made in a fully vertically integrated, wholly owned supply chain based mainly in North America. There has long been controversy about the burning of wood as a green/clean energy source (it releases captured carbon and produces particulate matter) plus specific issues about the wood Drax burns. Here the group has been accused of “greenwashing” (it claims to burn only waste wood, forest clearings and ultra-low quality trees) but there have been suggestions that it also burns higher quality wood. 

Hydro

Globally, hydro is a key generating source (15 per cent) but is tiny (at below 2 per cent) in the UK with only a couple of facilities within SSE’s portfolio. Here it is largely for power storage or emergency infill rather than core generation and this is unlikely to change.

New generation energy

This is something of an adjunct from the clean sector and largely points to the small modular reactor (SMR) sector. Nuclear can still be an issue for some investors but this exciting new generation sector gives a relatively rare opportunity to invest in nuclear generation. Nuclear is more typically a state-funded sector with power stations costing perhaps £50bn but SMRs (according to Rolls Royce (RR), the only substantial UK player) will start at £1.8bn and likely reduce as volumes rise. This subsector should play a major role in the decentralisation of power generation. While capital costs are higher than wind generation, long-term use costs are likely to be materially lower with much longer lifespans. 

Generation, supply and distribution

This is the more stable, utility-style end of the energy space where low competition, even monopoly positions allow for more defensive investments but more typically without the scope for substantially market beating returns. This was also historically where one would have come for high yields and metronomic dividend performance. The turbulence in large-scale energy markets in the last five years has allowed much stronger share price performance but this is largely anomalous and for many this is still a subsector best targeted for long-term income returns. 

However, the changes in the energy profile of the UK have led the players in this space to swing their free cash flow profile away from their historic position of having almost literally nothing else to do with their surpluses other than reward shareholders. Now large capital investment programmes such as National Grid’s (NG) £60bn+ grid renewal and localisation are changing capital allocations and in the process are likely to change these stocks from an income bias to something more akin to growth/income. This should raise likely total shareholder returns from mid-single digit percentages to high single, perhaps even low double digit. 

Supply 

There is relatively little for investors to play here with the bulk of the big six suppliers (British Gas, Octopus Energy, E.ON Next, OVO Energy, EDF Energy, and ScottishPower) either privately owned or part of international businesses. The only UK-listed access is for British Gas which is around half of Centrica (CNA), so this sector is essentially a closed avenue today for direct investment. 

Generation 

The only substantial generator listed in the UK is SSE (SSE) which is increasingly focused on green energy, while retaining capacity in gas powered facilities: its gas capabilities remain larger than its wind capacity but by 2027, this should have reversed. It is also a grid operator/distributor in Scotland. Drax is a single location generator, while nuclear power in the UK is controlled by France’s EDF (unlisted) with the balance of gas powered output not run by SSE being in the hands of Germany’s RWE (DE:RWE). 

Distribution

The UK gas network is owned by a consortium of private equity investors, while the electricity network remains largely within listed businesses. National Grid (NG) operates the whole of England and Wales with SSE running part of the Scottish system alongside Spain’s Iberdrola (ES:IBE). NG has been described as “reassuringly dull” as the UK grid has to operate, and customers have to pay for it. With the UK power system increasingly decentralising, that could be under threat, but NG is seizing the opportunity to play a major role in the switch to local generation and distribution. The market seems to believe that it might just work. Perhaps less rosy is that operations in the US now deliver two-thirds of the group’s earnings and policy in that market is looking to favour fossil fuels over green generation.

SSE too has sought to change its spots and has more than once cut what was once seen the UK’s safest dividend to instead fund growth, mainly in renewables. While it may not massively increase its total power generation in this process or be able to charge customers more, the market values wind electricity much more highly than gas electricity so investors should win. 

A potential fly in the ointment for these former utilities is their capital structure, especially in NG’s case, using higher debt levels within their capital base (akin to the issues in the water sector). Heavy spending on transition will probably see debt rising further. The days of cheap money are over and this capital structure risks being a drag on growth.

Aberdeen Asian Income Fund Limited (the “Company”)

15 July 2025

Declaration of Second Interim Dividend

Highlights

·    Annualised dividend yield of 6.8%.

·    Second quarterly interim dividend of 3.84p per share.

The Board has declared a second quarterly interim dividend of 3.84p per share for the year ended 31 December 2025, which will be paid on 22 August 2025 to shareholders on the register at the close of business on 25 July 2025. The ex-dividend date is 24 July 2025.

Based on a share price of 223p on 30 June 2025, and taking into account the first interim dividend already paid, this equates to an annualised dividend yield of 6.8%.

This is the second dividend payment announced by the Company following the introduction of the enhanced dividend policy earlier this year, to broaden the appeal of the Company’s shares to a wider range of investors and to reflect the sustained investor appetite for yield in the current interest rate environment.

The Company offers the option for shareholders to invest their dividend in a Dividend Reinvestment Plan (“DRIP”), which is managed by the Company’s Registrar, Computershare Investor Services PLC. The deadline for elections under the DRIP is 1 August 2025.

Note:

The Company’s dividend policy, as announced on 16 January 2025, is to set the dividend at 1.5625% per quarter of the Company’s net asset value (“NAV”), equating to approximately 6.25% of NAV per annum. The dividend is calculated using the Company’s NAV on the last business day of the preceding financial quarter (i.e. the end of March, June, September and December). The second quarterly interim dividend of 3.84p per share is based on 1.5625% of the Company’s NAV of 246.02p per share as at 30 June 2025

Chairman’s Statement

Building on our strengths: enhanced team, attractive yield and strong results driving shareholder value

This has been an exciting period for our Company. We strengthened our investment team with the appointment of an additional highly experienced lead portfolio manager, bringing fresh insight to complement our existing expertise. Our enhanced dividend policy – delivering one of the most compelling yields in the sector – is already attracting more income seeking investors. Together with a robust share price performance, these developments further reinforce our long term track record and investment appeal.  

Investment Management Team

During the period, we were pleased to welcome Isaac Thong as our lead manager, working alongside Eric Chan. Isaac has joined Aberdeen’s Asia Pacific Equities team as Senior Investment Director, based in Singapore, and is responsible for the day-to-day portfolio management of the Company. He also leads the Asian Income portfolio construction group within Aberdeen which includes responsibility for the Company’s portfolio.

With over 15 years’ experience investing in Asian equities, Isaac brings a wealth of knowledge and expertise that will enable the investment team to continue finding companies that will deliver sustainable growth, consistent income and attractive returns for our shareholders.

Performance

It is pleasing to report a share price total return of 6.3% for the six months to 30 June 2025 and a narrowing of the discount of the share price to the net asset value (“NAV”) per share from 12.5% to 9.3%. 

The NAV total return for the period was 2.2%, compared to a total return of 4.5% from the MSCI AC Asia Pacific ex Japan Index (the “Index”).  

The NAV underperformance for the period under review was due primarily to the portfolio’s underweight exposure to Chinese internet stocks. Historically, the Company has had little or no China internet exposure because these companies did not pay a dividend, which worked well previously but has had an impact on performance this year.

Encouragingly, the Company continues to outperform the Index over three and five years in both NAV and share price total return terms. These long-term absolute and positive returns for investors have been achieved without compromising on quality, reflecting the Investment Manager’s disciplined investment approach. The Investment Manager has recently implemented a refined strategy of balancing income and growth across key Asian markets. This has resulted in a rise in the portfolio’s weighted average return on equity, profit margins and yield.

13/08/2025

Can dividend hero trusts survive the shift to buybacks?

By Dave Baxter

Investors’ Chronicle

Once criticised as a ‘Jurassic Park’ of stock exchanges due to its obsession with dividends, the UK market has changed tack recently. UK-listed companies are boosting returns via an enormous volume of share buybacks, sometimes at the expense of dividends.

This has already had a big effect on how UK equity income trusts operate. Temple Bar (TMPL) addressed this “distributional shift” earlier in the year by changing its dividend policy and increasing its payout using capital reserves. Dunedin Income Growth (DIG) has just followed suit, announcing a dividend increase and saying it would draw on both capital and income reserves to “provide greater investment flexibility”.

With the buyback rush showing no sign of slowing down, there’s reason to suspect we might see more UK income trusts start doing this.

This switch might prove easier for some than others. But certain trusts will be feeling the pressure – for instance those with a long record of increasing their dividends.

The DIG board, for example, referenced its presence in the AIC’s “next generation of dividend heroes” list (trusts with between a decade and 20 years of dividend growth) when announcing its policy change. Plenty of UK income trusts sit in such lists, including the original dividend heroes cohort of those that have upped payouts for 20 consecutive years or more.

Among these, City of London (CTY) has increased its dividend for 59 consecutive years, with JPMorgan Claverhouse (JCH) and Murray Income (MUT) on 52 years. This list also includes Merchants (MRCH), CT UK Capital & Income (CTUK), Schroder Income Growth (SCF) and Aberdeen Equity Income (AEI).

With buybacks boosting returns, it should theoretically be easy for a trust to use those gains to make up for any lost dividends. Good underlying total returns and a decent level of revenue reserves, where present, will also help trusts switch policies in this way. Conversely, a fund that already has a high dividend might find this harder to sustain or increase.

The data shows a mixed picture on this front. Aberdeen Equity Income, City of London and JPMorgan Claverhouse have enjoyed especially strong net asset value returns over a 12-month period.

That could offset certain challenges, from the Aberdeen fund’s relatively high share price dividend yield of 6.2 per cent to the fact that City of London has limited dividend cover from its revenue reserves. According to AIC data, these would cover less than half a year of its current dividend payouts.

The challenges might be greater still for Murray Income and CT UK Capital & Income, which have some revenue reserves but have struggled in terms of performance, at least recently.

The issue is that trusts that perform badly could find themselves compounding this by selling assets to fund a dividend payment. Meanwhile, running down reserves might leave funds stretched in a crisis that sees companies pause their payouts, as happened in 2020.

If income streams remain less abundant than they once did, shifting to a capital and income payout policy could make trusts look more attractive than open-ended income funds, which simply pay out the dividends they receive. The latter might thus pay out less in future.

But trusts do need to weigh up the costs, and risks, of such a shift.

SUPERMARKET INCOME REIT PLC  

(the “Company”)  

  

DIVIDEND DECLARATION

   

Supermarket Income REIT plc (LSE: SUPR) has today declared an interim dividend in respect of the period from 1 July 2025 to 30 September 2025 of 1.545 pence per ordinary share (the “First Quarterly Dividend”).

The First Quarterly Dividend will be paid on or around 21 November 2025 as a Property Income Distribution (“PID”) in respect of the Company’s tax-exempt property rental business to shareholders on the register as at 24 October 2025. The ex-dividend date will be 23 October 2025.

Please note that there is no scrip dividend alternative available for the First Quarterly Dividend and it will be paid in full as cash. The Board will keep under consideration the offer of a scrip dividend alternative in respect of future quarterly dividends. 

Some passive income ideas really are simple. Here’s one!© Provided by The Motley Fool

Some passive income ideas really are simple. Here’s one!

Story by Christopher Ruane

While the theory of passive income is straightforward, in practice some ideas sound complicated to

Why I like this idea

When it comes to passive income, I like this idea for a few reasons.

I can match it to my own available funds, even if I have a fairly small amount of money to invest.

I am investing in proven businesses, not unproven concepts. On top of that, a large established company can do things that are simply out of my capability if I tried to do them myself.

Instead of struggling to set up an online business selling t-shirts, I could simply buy into a giant like Amazon or JD Sports that can achieve economies of scale I never would on my own.

Putting the idea into practice

So, for example, although JD Sports does pay a dividend, its current yield is 0.9%. That means that for every £100 I invest today, I will hopefully earn 90p a year in passive income.

By contrast, the dividend yield of FTSE 100 asset manager M&G (LSE:MNG) is over 10 times higher at 9.9%.

When hunting for passive income ideas in the stock market, I start by looking for great businesses with attractive share prices. I then look at yield.

Bear in mind that no company’s dividend is guaranteed to last. For example, M&G saw more policyholders pull money out of its main business than they put in during the first half of this year. If that trend continues (for example, because M&G’s asset managers underperform compared to rivals), it could lead to lower earnings and ultimately perhaps a dividend cut.

Looking for potentially lucrative dividend shares to buy

Still, while I see the risk, I continue to own M&G shares and earn dividends from them.

I like the fact it operates in a market where the customer demand is simply massive and is likely to remain that way over the long run. While that attracts strong competition, M&G benefits from its well-known brand, an existing customer base in the millions, and a proven ability to generate sizeable free cash flows.

Weighing such positive attributes against risks, then considering the value offered by the share price (and finally the current dividend yield) is the approach I take when looking for passive income ideas in the stock market.

A lifelong second income for just £10 a week? Here’s how!© Provided by The Motley Fool

Setting up a second income not just for next year, or even the next decade, but the rest of my life appeals to me.

Such dividends are never guaranteed, but by diversifying a portfolio across a number of different shares, hopefully there will always be some income even if individual shares reduce or cancel their payouts along the way.

To put that into perspective by the way, FTSE 100 investment trust Scottish Mortgage last cut its dividend per share almost a century ago, after the famous 1929 Wall Street crash !

With a spare £10 a week, here is the approach I take to building such passive income streams.

What to look for when buying dividend shares

I think it is too easy – and potentially unhelpful – to complicate things when it comes to the stock market. So like billionaire investor Warren Buffett, I tend to think of a share as a small stake in a company.

I would not invest in a company I do not understand. Nor would I buy into one unless I felt upbeat about its long-term prospects – and felt the price I was paying represented good value for what I was getting.

Dividend Heroes

Gilt Investment for Beginners: The Ideal Low-Risk Choice

Story by Money Marshmallow

Introduction

Gilts are bonds issued by the UK government. In recent years, they have become increasingly attractive to individual investors due to increasing interest rates and tax efficiency.

What are gilts?

Gilts are a type of government bond. When you buy a gilt, you effectively lend money to the UK government in exchange for periodic interest payments (coupons) and the return of your initial investment (the principal) when the bond matures.

UK government bonds are known as ‘gilts’ because their past paper certificates had gilded (golden) edges. The name also reflects their security and reliability, as the UK Government has never failed to make repayments.

Key features of gilts:

• Issued by the UK government – Issued by the UK government, gilts are generally considered safe investments. The UK government has solid investment grade credit ratings of Aa3, AA-, and AA from Moody’s, Fitch, and S&P respectively.
• Fixed interest payments – gilts pay a fixed rate of interest that is set at the inception of the bonds. These payments are known as ‘coupons’. The interest payments are typically made every 6 months.
• Different maturities – Maturity is the time when the bond has come to the end of its life and the investor receives their money back. This ranges from a few years to several decades.
• Traded in the market – meaning their prices can go up or down.
• Return of principal at maturity – the issuer (HM Treasury) issues gilts with a promise to return your capital at maturity.

Related: Investing for Beginners: How to Start Investing in the UK

UK Gilts Explained

The pros and cons of investing in gilts

Pros:

• Low risk: Since they are issued by the UK government, gilts are considered very safe.
• Tax benefits: Capital gains from gilts are not taxed, making them attractive for investors.
• Predictable returns: You know how much you will receive at maturity, and can see a schedule of period interest (coupon) payments.
• Liquidity: Gilts can be easily bought and sold in the market.

Cons:

• Low returns: Compared to stocks or corporate bonds, gilts usually offer lower potential profits.
• Interest rate risk: Buying a gilt at a 3.75% yield may seem attractive now, however, if interest rates were to rise you would be locked into a lower rate. This causes investors to sell legacy gilts with lower rates and can lead to their prices falling.
• Inflation risk: Like all investments, inflation will eat away at the real value of returns. For example, if a gilt is yielding 4%, and inflation is 2%, the real return is 2%.

Why is now a good time to buy gilts?

In the past, gilt yields were very low, as central banks lowered interest rates to try and stimulate borrowing after the 2008 financial crisis, and then again during the COVID-19 pandemic. However, recent years have seen central banks attempting to combat inflation by increasing interest rates, causing yields to rise and the prices of older gilts issued with low coupons fall.

This presents an opportunity for individual investors to buy them at a discount, and benefit from their tax-free capital gains when they mature.

For example, take a gilt maturing in 2026 with a low coupon of 0.125%:

• It is currently trading at a discount (<100).
• The taxable income component of its return (0.125%) is negligible.
• When it matures, the price will return to its full value (100), giving you a capital gain.
• Since this gain is considered capital rather than income, the bulk of the yield is tax-free, making it very tax-efficient.

This tax advantage makes low coupon gilts an efficient way to earn returns, especially for higher-rate taxpayers.

Comparing gilts to other investments

• Gilts vs. Corporate Bonds: Corporate bonds often offer higher yields, but they come with more risk as companies can default. Generally speaking, corporate bonds will have higher coupons, as such they are more commonly held within ISA wrappers.
• Gilts vs. Stocks: Stocks are more volatile than gilts, and provide less capital protection. However, they have higher expected returns, which minimises the risk of not receiving a required return target. Stock market index trackers can be a solid choice for investors looking to maximise long-run returns, especially if held within an ISA wrapper.
• Gilts vs. Cash Savings: Cash savings provide the greatest protection of capital (providing for the FSCS limit). Further, flex savings accounts can be accessed on demand without needing to sell a bond at the prevailing market price. However, cash savings are income products (taxed at your income tax rate), making the rates available less competitive if held outside a tax wrapper.

Who should invest in gilts?

Gilts may be suitable for you if:

• You want a safe and predictable investment.
• You are looking for tax-efficient ways to invest, especially outside of a tax wrapper such as an ISA
• You need to preserve capital.
• You prefer stability over risk.
• You are looking for a hedge against stock market volatility.

How to invest in gilts

You can buy gilts through a broker, most investment platforms will offer gilts. You can also gain exposure to gilts through pooled products such as ETFs, however, pooled products will not be subject to the same tax treatment (free of capital gains tax).

Steps to buying gilts:

1. Determine your investment objectives – Why are you investing? Will you need your money back in a year, or a few years? How much will you need to earn to meet your objective? Your investment objectives will help you narrow down a suitable range of gilts.
2. Choose a platform – Open an account with an investment platform or broker. For example, WiseAlpha allows you to start investing with just £100 per gilt.
3. Review tenors and yields – Check the current market yields for gilts with different tenors (the length of time until they are repaid). Choose a gilt that matches your investment goals.
4. Place an order – Buy directly through your chosen platform.

Conclusion

Gilts have become an attractive investment for individuals due to recent economic changes and their tax efficiency. While they may not offer the highest returns, they provide a safe and predictable way to grow your money, especially in uncertain times.

Key takeaways:

• Gilts are low-risk government bonds suitable for conservative investors.
• They offer tax benefits, making them efficient, especially for higher-rate taxpayers.
• The current market environment makes discounted gilts a unique opportunity.
• While they are safer than stocks or corporate bonds, they have lower return potential.
• Gilts are easy to buy through brokers.

If you are a higher or additional rate tax-payer looking for a low-risk investment that can help preserve and grow your wealth with high levels of tax efficiency, gilts might be worth considering.

Pair trading.

Could be traded with a higher yielder to reduce the overall risk and still receive a blended yield for the target yield of 7%.

Remember a yield of 7% doubles your income every ten years, no matter whatever direction the markets travel.

30 September 2025

Assura plc

Trading update for the first half ended 30 September 2025

Assura plc (“Assura”), the UK’s leading diversified healthcare REIT, today announces its Trading Update for the first half to 30 September 2025, in advance of the annual general meeting being held later today.   

Jonathan Murphy, CEO, said:

“I am proud to report on a strong trading performance over the first six months of the financial year, in what was a period of uncertainty for the business. This is testament to the hard work and dedication of our team members, the strength of Assura’s business, and the vital role we play within the UK healthcare infrastructure.

“We have delivered strong rental growth, which has flowed into the positive property valuation uplift, and have continued to identify opportunities to deliver new healthcare developments for both the NHS and independent sector.

“There remains critical need for investment in healthcare buildings to enable the provision of high-quality health services. Assura’s specialist team has the skills and expertise to partner with our customers to meet these needs.”

Continued track record of delivery to enhance portfolio value and earnings

•     Rent reviews completed in the first half generated:

o  Like-for-like increase of 5.6% on £25.5 million of rent roll reviewed

o  Weighted average annual uplift of 2.9%

•     Annual equivalent uplift of 2.7% on OMR reviews, 3.0% on RPI and other

•     15 asset enhancement lease events (renewals, regears and net lettings) completed covering £1.0 million of rent roll, adding 11 years on average to those leases

•     Commenced roll out of rooftop solar commercialisation project

o  First installation at Crompton Health Centre in Bolton fully energised and moving on site with a further 10 sites by December

o  Each installation will generate a significant reduction in carbon emissions, reduce energy costs for tenants and generate an attractive investment yield

o  Total spend on the first projects is expected to be £1 million, with a pipeline of further 40 future schemes now under detailed review

Ongoing development activity

•     Construction underway on a £18 million primary care scheme in Weston-Super-Mare pre-let to the NHS on a 25 year lease subject to 5 yearly CPIH rent reviews. This is the first development funded through the £250 million joint venture with USS

•     Construction to commence shortly on a new £19 million independent hospital in Peterborough pre-let to a tier one independent health provider on a 25 year lease subject to 3 yearly RPI rent reviews

•     Agreements to commence £7 million extension on two existing independent hospital sites to provide further on-site clinical capacity

•     Three existing on site developments in Ireland continue to progress well (total cost £31 million of which £17 million has been spent to date)

Attractive pipeline of opportunities to support health care system

•     £250 million development pipeline capable of commencing in the next 2 years

o  £160 million of large independent sector projects

o  £90 million of NHS primary care schemes

•     31 asset enhancement lease events covering £5.6 million of existing rent roll in the current pipeline

Portfolio positioned to deliver strong future cash flows

•     Portfolio now stands at 602 properties with an annualised rent roll of £179.5 million (March 2025: 603. £177.9 million) and a WAULT of 12.3 years (March 2025: 12.7 years)

•     Following active portfolio management, portfolio rent reviews consist of: c.54% OMR, c.46% indexed, fixed or other

•     Highest-ever admissions into the independent sector generating record growth in our private hospitals operational profitability, improving rent cover to 2.6x from 2.3x

•     Portfolio management activities and rent reviews have contributed to valuation uplift of approximately £12 million in the first half. Portfolio Net Initial Yield 5.23% (March 2025: 5.21%)

Primary Health Properties PLC (“PHP”) offer for Assura and delisting from the London Stock Exchange (“LSE”) and Johannesburg Stock Exchange (“JSE”)

On 5 September 2025, at the request of PHP, Assura made requests to the FCA and the London Stock Exchange respectively to cancel the listing and trading of the Assura Shares on the Equity Shares (Commercial Companies) category of the Official List and Main Market of the LSE (the “LSE Delisting”). It is anticipated that the LSE Delisting will take effect no earlier than 7.30 a.m. on 6 October 2025.

 STIFEL RAISES PRIMARY HEALTH PROPERTIES TO ‘BUY’ (HOLD) – PRICE TARGET 105 (92) PENCE