One of the benefits of market volatility is its ability to depress shares prices, which in the main is due to fear rather than the actual fundamentals of the company.

And while investors need to be selective rather than buy any old junk with a high yield, it’s at times like this that investors who are prepared to do their research can benefit over the longer term through buying fundamentally good companies offering above average, and importantly growing, yields.

Be careful with your eggs

Another important factor that should be at the forefront of investors’ minds is to ensure that they don’t put all of their eggs in one basket. For those that are interested there’s plenty of further research in this field, which shows that many inexperienced private investors can underperform the market as a whole by selecting only three or four shares, usually in the same sector. Get the call correct and the outperformance would be significant – a concentrated portfolio of housebuilders would have shown significant gains since 2012, however, those holding mining shares would have seen their portfolios slump.

Turning to the chart, we can see that both of the financial stocks, Lloyds (LSE: LLOY) and Legal & General (LSE: LGEN) have underperformed the wider FTSE 100 while Imperial Brands (LSE: IMB) has managed to outperform by some margin, giving some balance to this particular basket of shares.

A lot to like

As the subtitle suggests, there’s a lot to like about the shares under review today, both in terms of the dividend yield on offer and the dividend growth.

Starting with the lowest yielding share, Imperial Brands, at first glance the shares don’t scream cheap trading at around 15 times forecast earnings and yielding over 4%. However, on closer inspection, 15 times earnings isn’t overly expensive for a defensive share. And while not to every investor’s taste, those who have bought into this share have seen the dividend grow at a CAGR (compound annual growth rate) of over 10% since 2010 according to data from Stockopedia, not to mention the near doubling of the share price!

Next up is private investor favourite Lloyds. While maybe not an obvious choice due to the fact that the bank had to cut its dividend during the financial crisis and didn’t return to the dividend list until 2015 with a final dividend for the year to 2014.

However, the dividend grew by 200% for the year to 2015, and analysts expect the dividend to nearly double again for the year to 2016. With such rapid dividend growth and the shares languishing on a forecast PE of under 9 times earnings, the yield on offer is just under 7% due to the current negativity in the sector.

Finally, we have the star of the show, Legal & General. Like Lloyds and other shares in the financial sector, the shares have underperformed over the last 12 months. However, investors who were brave enough to hold on since 2010 have seen the dividend more than triple and the share price more than quadruple – not bad for a boring insurance company!

The shares currently trade on a forecast PE of just over 10 times earnings and are expected to yield well over 6% making them rather interesting at these prices.

Will you grow your income in 2016?

Let's face it, investors love juicy dividends, and if this selection of dividend stars isn't for you, then you should take a look at this report prepared by one of The Motley Fool's top income advisors, James Early, who has found a share that has stirred his interest.

These are the sort of investment opportunities, which when coupled with other like investments could help contribute to life-changing scenarios (a wealthier retirement for example) and right now, you can access ALL of them for just pennies a day.

To find out more, take a few moments out of your day and download A Top Income Share From The Motley Fool.

The report is free to a good home and you're not obligated in any way. So Click Here sit back, and enjoy.

Dave Sullivan owns shares of Imperial Brands. The Motley Fool UK has no position in any of the shares mentioned. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.