When looking for big dividends, investors typically flock to the FTSE 100 first. That makes sense, as the top index is home to many of the UK’s most mature and cash-generative companies. But I think ignoring the FTSE 250 could be a mistake.
The mid-cap index is often thought of as the place to find growth shares, making their way up towards the top tier. But there are plenty of smaller companies paying good dividends too.
As part of my regular dividend research, I’ve put together a list of the 10 biggest dividend yields in the FTSE 250 at the moment.
| Company | Recent price | 12-month change | Forecast yield |
| Diversified Energy Company | 115p | +7.6% | 12.2% |
| Jupiter Fund Management | 146p | -36% | 11.8% |
| Ferrexpo | 171p | -27% | 9.3% |
| Vistry Group | 757p | -23% | 8.3% |
| Target Healthcare REIT | 82p | -28% | 8.3% |
| Sequoia Economic Infrastructure Income Fund | 87p | -17% | 7.4% |
| TwentyFour Income Fund | 99p | -13.5% | 7.3% |
| GCP Infrastructure Investments | 97p | -9.1% | 7.2% |
| Ninety One | 200p | -22% | 7.1% |
| Crest Nicholson Holdings | 245p | -20% | 6.9% |
Funds
The first thing I note looking at the list this time round is the number of investment funds on top dividend ratings. We see Target Healthcare among the biggest, after a share price slump. Then there’s a couple of income funds too, on attractive yields.
Nestling just outside the top 10, there’s also NextEnergy Solar Fund, with a predicted dividend yield of 6.8%. Might that be a good one to buy to counter the risk of Diversified Energy Company, which is in the oil and gas business? Or, at least, offset any environmental discomfort.
Generally, I rate income-based investment funds highly. They can offer a regular and progressive cash stream, and can also provide some desirable diversification in a single investment.
Finance and houses
Just like some of their FTSE 100 counterparts, a couple of investment firms make the list. I’ve long liked the look of Jupiter Fund Management. And even though the shares have gained 75% since October’s low, they’re still way down over 12 months. And that makes the forecast dividend still look attractive.
We have a couple of housebuilders making the top 10 too. Again, that’s similar to the FTSE 100. And again, prices have come back some way from their lows of 2022. We could be forgiven for thinking there might be decades of strong demand ahead in the housing market, even if we perhaps face a weak year or two.
Falling
Overall, I’m seeing falling dividend yields in the FTSE 250. But that’s not because of anything bad, it’s just because share prices have been recovering. Hopefully, we might be past the worst of the 2022 pessimism now.
I wouldn’t buy any dividend shares simply based on a look at their yields. Dividend’s aren’t guaranteed, and these predicted payouts might not happen.
But I reckon it’s a good way to start researching dividend stocks. And checking regularly can give us good insight into investor sentiment.
