Long Term Stats

The teal line in Figure 16 shows an index of real net dividends on ordinary shares from 1950 to 2007, constructed by linking together the share indices described under dividend yields in Figure 6 and dividing by the price index shown in Figure 2. The dividend index in nominal values has been obtained by multiplying the value of the share indices described in Figure 6 by the net dividend yield. The index of real share dividends is then obtained by dividing the share dividend by the price index shown in Figure 2. The orange line shows an index of company earnings divided by the price index. The index of company earnings is based on the FTSE Actuaries 500 Share Index from April 1962 and the FTSE Actuaries All-Share Index from January 1993.

Figure 17 gives the percentage increase in the net dividend index on ordinary shares over periods of one, five, 10 and 20 years, ending in December each year from 1986 to 2007. On the left are shown percentage increases in the nominal index, and on the right are shown percentage increases in the real index, relative to retail prices.