Is now the time to turn to high yield dividend shares?

With the ASX 200 experiencing significant volatility this year, investors may be shifting their attention away from growth, towards more reliable returns. 

One such strategy to consider is dividend investing. 

According to S&P Global, Australia has historically been one of the highest-yielding equity markets in the world. 

However, this has shifted in the last few years. 

Data shows the trailing 12-month dividend yield of the S&P/ASX 300 Index (ASX: XKO) sits at approximately 3.5%.

This still outpaced other markets in Europe, Canada and the US. 

However it’s significantly lower than its long-term average of approximately 4.5%.

Why turn to dividend shares now?

Even though dividends are shrinking, dividend shares can be particularly attractive during periods of market volatility because they provide investors with a steady stream of income even when share prices fluctuate. 

Companies that consistently pay dividends are often well-established, financially stable businesses with reliable cash flow, which can make them more resilient during economic uncertainty. 

Regular dividend income can help offset capital losses during market downturns and provide investors with greater confidence to hold their investments long term. 

In addition, reinvesting dividends during weaker markets allows investors to purchase more shares at lower prices, potentially enhancing long-term returns once market conditions improve.

With that in mind, here are several ASX dividend shares with comparably high yields. 

IVE Group Ltd (ASX: IGL)

IVE Group provides communication solutions. Its services includes creative services, personalised communications, print production, retail display, promotional merchandising, third party sourcing, logistics and fulfilment and managed solutions.

Recently, Bell Potter released updated guidance. 

The broker is expecting the company to pay fully franked dividends of 18 cents per share in FY 2026 followed by 20 cents per share in FY 2027. 

Based on its current share price, this would equate to yields of 6.8% and 7.6%, respectively, well above the ASX benchmark of 3.5%.

Australian Foundation Investment Company (ASX: AFI)

Another ASX dividend stock offering market beating yields is Australian Foundation Investment Company. 

The self-managed investment company is currently offering a grossed-up dividend yield of approximately 5.8%. 

Furthermore, it has a strong track record of bumping up its yield over the last decade. 

Plato Income Maximiser (ASX: PL8)

Plato Income Maximiser provides investors with the opportunity to benefit from an indirect investment in actively managed well-diversified Australian listed equities portfolio that aims to generate both income and a total return in excess of the benchmark. 

It also aims to make regular monthly dividends once it has sufficient profit reserves.

In some ways, this is similar to an ASX ETF. 

It holds an underlying portfolio of investments that it manages on behalf of its shareholders. 

This dividend stock currently offers a yield of roughly 4.85%.

Betashares Australian Dividend Harvester Fund (ASX: HVST)

For investors looking to diversify beyond individual dividend shares, this ASX ETF could be another option. 

The fund’s share portfolio is generally selected from the largest 100 Australian shares on the ASX, and screened for high dividend and franking outcomes based upon expected future gross dividend payments.

It currently offers a 12 month gross distribution yield of 7.4%. 

The post Is now the time to turn to high yield dividend shares? appeared first on The Motley Fool Australia.

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Motley Fool contributor Aaron Bell has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.