Capital Group’s latest dividend report shows a decline in European payouts, with core growth in the first quarter at 3.4%. This includes benefits from exchange rates but also reflects cuts by key firms, including Norwegian energy producers and French luxury group Kering. These changes highlight financial strain across the region.
While first-quarter payouts are usually lower, Fernando Luque from Morningstar notes that some of Europe’s top income-generating stocks are reducing dividends due to weaker earnings, higher debt, and investment needs. For instance, Stellantis skipped an ordinary dividend this year after losses from its electric vehicle plans. Volkswagen, Mercedes-Benz, and Volvo also reduced payouts.
Dan Lefkovitz from Morningstar Indexes identifies three signs investors should watch for. The payout ratio, which shows how much of a company’s earnings go to dividends, can signal trouble. High ratios leave firms with less financial cushion, making them more likely to cut or stop dividends during downturns.
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The second sign is a company’s economic moat, or ability to protect its market position. Firms with strong moats, like those with durable advantages or solid balance sheets, cut dividends less often. Companies with weak moats face more financial pressure, increasing the chance of dividend cuts.
The third indicator is the “distance to default,” a measure of the risk of a company’s assets falling below its liabilities. Lefkovitz says ignoring this risk when pursuing high-yield dividends can be dangerous. Long-term success in equity investing depends on holding companies that can sustain and grow their income streams over time.
Bitcoin has outperformed most assets over the past decade but is rarely included in multi-asset portfolios. Dovile Silenskyte from WisdomTree says this is due to investor behavior. People often exit during market drops, missing recovery phases. Viewing volatility as a risk leads to poor allocations, despite Bitcoin’s low correlation with traditional assets and strong positive skew, which can improve diversification.
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Silenskyte says exposure affects investment results, while timing improves them. Investors often focus on entry points, underestimating the need for consistent exposure. Missing 30 of Bitcoin’s best trading days could cut returns from over 9,000% to 26%. She suggests strategies like a 1–2% market-cap-neutral allocation, rebalancing, and dollar-cost averaging to reduce entry variability.
Investment managers warn against behavioral biases that hurt returns. Peter Smith from Aviva Investors says greed can lead to risky bets, like investing in speculative assets or using borrowed money. Envy might push investors to chase performance or focus on short-term trends instead of long-term plans. Gluttony can show up as overtrading or over-diversifying, while lust might lead to day trading or speculative opportunities.
Pride can make investors ignore professional advice, overconfidently believe they can beat the market, or blame others for bad decisions. Smith stresses the importance of seeking expert guidance. “The moral of the story,” he says, “is that investors should take advice from professionals.”
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Smith also warns against recency bias and loss-chasing, which can lead to poor decisions. An investor who sold during peak tariff concerns in March 2025 would have missed a later rally. He advises starting early, staying disciplined, and avoiding emotional reactions to market changes.
Bitcoin’s volatility brings risks, but its low correlation with traditional assets and strong skew can help diversify portfolios when managed well. Silenskyte says success depends on managing exposure and avoiding behavioral mistakes. “Exposure drives outcomes, timing refines them,” she says, emphasizing the need for a balanced, long-term approach.