Tuesday, 16 March 2021 Reading time : 3 minutes

Interest rates are rising, but historically they are still at a low level. Rising interest rates have led to falling bond prices. In addition, there is a general global economic recovery, so that rising corporate profits are to be expected. Therefore, our strategists have underweighted bonds in their asset allocation. ZKB Equity Research considers the currently increasing inflationary pressure to be only a transitional phenomenon. In addition, value stocks - and these tend to include dividend-strong equities - are clearly undervalued compared to the overall market. Against this background, shares with high dividend payments also have their raison d'être. However, it is not only the dividend yield that matters, but also its consistency. Only well-managed companies with solid balance sheet ratios that generate a high free cash flow are in a position to pay a sustainably high or even rising dividend.

Our selection
In our selection of companies for the dividend basket, we have taken care to limit the risk of dividend cuts or even dividend defaults. To reduce the stock-specific risk, the selection is broadly diversified across sectors.

A total of 20 high-dividend companies are included in the basket, the weighting of the individual stocks is 5% each, and the current estimated average dividend yield of the selection was 4.7% when the basket was created.

Tracker Certificate on a global dividend basket (3-year duration)

• Termsheet CHF
• Termsheet EUR
• Termsheet USD

 

Disclaimer
This communication is for marketing purposes. It is neither an offer nor an invitation to submit an offer, to purchase or to subscribe to securities and does not constitute investment advice. You should consult your advisors before making an investment decision.
Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, financial condition, development or performance of the issuer to be materially different from any future results, financial condition, development or performance expressed or implied by such statements.
The present document has not been drawn up by the research department as defined in the rules of the “Directives on the Independence of Financial Research” published by the Swiss Bankers Association, hence these rules do not apply to this document.
If securities are mentioned in the communication, the base prospectus, the final terms and any key information document may be obtained free of charge from Zürcher Kantonalbank, Bahnhofstrasse 9, 8001 Zurich, VRIS, and from www.zkb.ch/finanzinformationen.