The highest-yielding stock market in the world? Czech Republic

Research from Hargreaves Lansdown, the stockbroker, found that the Czech Republic was currently the highest-yielding country in the world, with the average share paying 6.1pc. Close behind is Pakistan, yielding 5.6pc, and Poland at 5.3pc. European countries dominate the top 10, with Spain, Norway, Russia and Hungary all featuring.

 “If yields on government bonds in a certain country are higher than the shares on its stock market then investors should steer clear,” Mr de Tusch-Lec said. “As a rule this will indicate that the country has a poor economy or a volatile currency. Either way this will erode returns. 

“For this reason investors should not be lured by the high yields on offer in Brazil. Some utility shares offer 7pc, but when government debt yields more than 10pc this is clearly not sustainable.”

 

DYI Comments:  When the U.S. market drops in value it will also pull down world wide markets with  Europe will not being an exception.  This could possibly bottom out stocks in Europe on a secular basis.  Currently the dividend yield of the Vanguard European Stock Index fund is 3.84% with a large enough decline an overall yield near 5% is possible.  Future estimated 10yr avg. annual returns would be enhanced possibly over 10%.  Of course currency translation could reduce or improve your returns depending on the value of dollar vs. the Euro.

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DYI