[longequityreturns] [equity_income_component]

How much of the return on equities comes from income as opposed to capital? Given the trend towards buybacks, one might reasonably expect the income component to be lower for US than for UK and that is what I have found (US numbers not updated).

For periods of 15 years  falling within 1962 to 2018, the UK income component averaged 41% (being much lower at 31% for US). Excluding the last 6 years, the UK income component was lower at 39% for 1962-2012. However, extending the period  for 4 years, the UK income component was 44% for 1962-2022.

While UK actuaries commonly used to assume 50%, this is now an overstatement.