A total 493 companies listed on the London Stock Exchange have cancelled, cut, or suspended dividend payments between 1 January 2020 and 23 November, new analysis from GraniteShares has revealed.

The ETF provider revealed that this represents a 10.8% increase when compared to the period from 1 January to 24 July 2020.

GraniteShares, which offers a range of 3x short and 3x leveraged ETPs on popular UK and US stocks, suggested that “no segment of the market has been immune”.

The analysis showed that 51 FTSE 100 companies, 115 FTSE 250 companies, and 149 AIM-listed companies have either cut, suspended or cancelled dividends in 2020.

“Dividends and dividend growth play a very important role helping investors achieve sustainable income and long-term returns, and they are more important than ever now that interest rates are so low,” commented GraniteShares founder and CEO, Will Rhind.

“The expected slowdown in GDP in the UK and in many other countries in the fourth quarter means that companies may be under additional pressure to preserve cash, which could put further pressure on dividends. It is likely that investors will face a long wait until they see dividends return to their pre-COVID levels.

“With this in mind and against a backdrop of increased market volatility, we are seeing a significant rise in sophisticated investors and professional investors making greater use of shorting and leveraged investment strategies with a view to boosting returns.”

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