When a company makes a profit it normally has three options.
It can reinvest the money to grow the business, return it to shareholders through dividends, or buy back its own shares. The most effective management teams will use profits wisely, balancing reinvestment with shareholder returns.
While not every company will pay a dividend (think some of the big tech stocks) those that do can play an important role in any investor’s portfolio — not just those in or close to retirement who might need money sooner.
If you’re investing for income, dividend stocks can offer a healthy yield, while also letting you benefit from more potential growth compared to only investing in bonds for example. However, a highly diversified income portfolio will usually invest in both.
If you’re investing for growth, then you can use the income to buy even more shares, which should help pay you even more income in the future. Over time this can seriously add up as your reinvested returns start earning more returns, and so on. This is what we call compounding — a force so powerful that Albert Einstein himself called it the 8th wonder of the world.
But where in the world is paying the most income and how can investors use these stock markets to add more income to their portfolio?
Top 5 highest-yielding stock markets in 2026
| Market | Dividend Yield |
| MSCI Brazil | 5.79% |
| MSCI Latin America | 4.92% |
| MSCI Emerging Markets Indonesia | 4.81% |
| MSCI Emerging Markets Mexico | 3.95% |
| MSCI Europe Value | 3.94% |
Remember, yields are variable and no income is ever guaranteed. Source: Bloomberg, 17/02/2026.
Investing for income: top tips to remember
For every investor, whether you’re investing for income or growth, a diversified approach is the most sensible way to invest.
That means investing in lots of different types of investments like stocks and bonds, sectors and different parts of the world.
But it also means not just chasing the highest yielding stocks or funds.
As we’ve seen recently, uncertainty affects parts of the market differently. While some stock markets might offer lower yields, they could benefit your portfolio when higher-yielding markets take a hit. It means you should always have something working in your favour, no matter which way financial markets move.
Investors should also consider how sustainable the income might be going forward.
If a market or sector carries a very high yield, this could mean several things, like suppressed valuations leading to lower share prices and resulting in a higher-than-expected yield. At a company level it could also indicate that we could even see a dividend cut soon as the company can’t sustain the current payout. And at an index level, if many follow suit the dividend in the market would also suffer.
However, if the stock has a long history of paying an income, then it shows you it’s serious about paying dividends.
A history of growth is also important.
If your income stays the same year after year, inflation quietly erodes its purchasing power — which is why growing dividends are essential to maintaining and increasing your real income over time.
But at the same time, a company paying a lower yield, but one that’s growing, could be better in the long term than one paying an unusually high yield now with lower growth prospects.
Want to invest for income? 2 ETF ideas
When it comes to building a diversified investment portfolio, a handful of stocks isn’t enough. It’s why we prefer exchange traded funds (ETF).
An ETF is an investment that trades on the stock exchange, like a share, and usually tracks a market index, although some are actively managed to try to beat the market.
ETFs can give you instant access to hundreds of different investments, from stocks and bonds to commodities and more, across plenty of industries and parts of the world. They’re a cheap and easy way to invest.
If you’re looking to add income to a portfolio, these two income ETFs could help.
One is considered a more ‘core’ investment that could help offer some stability, and the other is a more adventurous option, called a ‘satellite’, to help add even more diversification and the potential for higher income.
How to build a core-satellite portfolio
iShares MSCI World Equity High Income: a core income ETF idea
The iShares MSCI World Equity High Income is actively managed and designed to invest in companies around the world who are known to pay higher-than-average dividends.
Paying dividends quarterly and being SFDR article 8 compliant (a widely recognised framework for ESG integration), this ETF finds itself fitting between many investment mandates.
Investors who want to invest in global companies, without any particular sector or regional bias, could find this ETF interesting.
Dividend yield: 9.27%. Remember, yields are variable and no income is ever guaranteed.
GlobalX SuperDividend: a satellite income ETF idea
The Global X SuperDividend is designed to invest in companies from various countries that are known for providing high dividend yields.
The ETF aims to replicate the Solactive Global SuperDividend index which tracks the performance of 100 equally weighted companies that rank among the highest dividend yielding equity securities in the world.
By focusing on this index, the ETF aims to give investors exposure to stocks that can generate regular income through dividends.
For investors who are seeking income‑generating investments, it could be worth taking a closer look at this ETF. It could also be considered by those looking for a way to earn money from their investments in addition to any potential growth in the stock prices.
Dividend yield: 8.91%. Remember, yields are variable and no income is ever guaranteed.
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Important information
Capital at risk. The value of your investments and any income from them may go down as well as up, and you may get back less than you invest. Past performance is not indicative of future performance.
ETF costs apply. If in doubt, you may wish to consult a professional adviser for guidance.