A Self-Invested Personal Pension (SIPP) offers the sort of long-term investment platform I think can be well-suited to long-term investing.
Many investors like the idea of tucking some high-yield dividend shares into their SIPP and letting the income compound over the years or decades.
Here are three high-yield UK shares to consider this September.
Henderson Far East Income
Henderson Far East Income (HFEL: LSE) aims to do what it says on the tin. In other words, the investment trust aims to use a portfolio of Asia-exposed shares to support it paying dividends.
It aims to grow the dividend per share annually. That would already be welcome news (although, of course, no dividend is ever guaranteed), but I find it especially appealing given that the trust already has a dividend yield of 10.8%.
The trust’s geographically-focused strategy means it is exposed to economic downturns in key Asian economies.
But its strategy has delivered the goods for many years on the trot at this point when it comes to dividend growth. I like its portfolio of Asian companies I think have ongoing growth potential, such as Taiwan Semiconductor Manufacturing.
M&G
Another share with a progressive dividend policy is FTSE 100 asset manager M&G (LSE: MNG). It also has an already attractive yield, currently standing at 7.6%.That is well over twice the FTSE 100 average currently.
M&G has even delivered impressive share price growth of 53% over the past five years.
Past performance does not necessarily reflect what may happen in future. But I do think that share price growth reflects a growing confidence among investors that M&G has a well-run business that can support its juicy, growing dividend.
It has millions of customers, a well-known brand, and deep experience in a market I expect to benefit from resilient customer demand.
Set against that, an ongoing challenge over the past several years has been to get investors to put more into M&G’s funds than they pull out. Otherwise, fee income could decline. I reckon it still has work to do to convince the City it can do this consistently.
Perhaps the interim results due this Wednesday (3 September) will provide useful data on that, as well as hopefully another dividend increase.
ITV
With its 6.1% dividend yield, I reckon broadcaster ITV (LSE: ITV) also merits consideration.
Unlike the two shares above, the FTSE 250 firm does not have a progressive dividend policy. But it does aim to maintain its dividend per share at the current level as a minimum and has delivered on that goal in recent years.
With a large audience for its programmes, growing digital operation, and sizeable production business that provides studios and expertise to other content makers, I believe ITV is striking a good balance of managing the shift from the old broadcasting model to a digitally focussed one.
Advertising revenues could suffer in an economic downturn, potentially eating into profits. The underwhelming performance this year of smaller rival STV could be a warning signal of some risks in the current environment that may also affect ITV.
But with its scale and proprietary assets from studios to intellectual property, I think ITV has some strong competitive advantages.
