Highlights

• The firm paid an 11p interim and a 23p final, together 34p per ordinary share.

• The final Dividend rose from 22p to 23p, extending the group's run of annual increases.

• The 23p final went ex on 24 September 2026 and was paid on 5 November 2026.

• Fund-management Earnings can swing with markets, so the dividend depends on Assets under management holding up.

Two cheques, 34p in total: that is what City of London Investment Group (LSE:CLIG) distributed over the last year. The year-end payment grew by a penny, and the structure is simple enough to chart on the back of an envelope. Here is what sits behind it.

Where the 34p came from

The interim of 11p went ex on 5 March 2026 and was paid on 2 April 2026. The final of 23p went ex on 24 September 2026 and was paid on 5 November 2026. The previous final, 22p, went ex on 25 September 2025, which sits just outside the twelve-month window and so is not counted. For holders of LSE:CLIG, the final is about two-thirds of the annual payment.

The Yield on the latest price

At a delayed price near 449p, the paid trailing yield is 7.57%, found by dividing 34p by 449p. That is higher than a published figure that implies a share price nearer 521p, so the gap is probably down to a different price date. The price used is indicative, and readers should check a live quote before judging the yield, since the yield changes with the share price.

A growing but modest record

The interim held at 11p across both years checked, while the final climbed from 22p to 23p. That takes the annual total from 33p to 34p, a rise of about 3%. No special dividends were found. A small increase of this size is consistent with a company that prefers gradual growth, and it keeps the payment in line with Inflation more than ahead of it.

What the Business does

City of London Investment Group is a London-listed asset manager that specialises in investing in closed-end funds, which are investment trusts that trade on stock markets. Its fee income depends on the value of the assets it manages, which links the dividend to market levels. The shares are not in a FTSE UK index, which can reduce trading Volume and widen the gap between the buying and selling price.

How fees link to markets

Asset managers charge a percentage of the assets they run. When markets rise, assets grow and fees increase. When markets fall or clients withdraw, assets shrink and fees fall. City of London Investment Group (LSE:CLIG) also has costs that do not fall as quickly, so profit can move by more than revenue. This explains why asset manager dividends are said to follow the market.

What could go wrong

A dividend funded from management fees is exposed to falling markets and client outflows, either of which would squeeze profits. A trailing Payout Ratio of about 92% implies little headroom if earnings dip. Payments are set by the board and can change. Because the price used is indicative, readers should check a live quote, and they should read the latest results to see how comfortably profit supports 34p.

Dividend cover

Dividend cover measures how many times Earnings Per Share exceed the dividend per share. A figure above 1 means earnings are larger than the payment, and a figure below 1 means the company is paying out more than it earned. Cover is a useful guide, but Cash Flow also matters, because dividends are paid in cash, and one-off items can distort earnings in a single year.

Liquidity and dealing costs

The ease with which shares can be bought and sold affects the return an investor actually achieves. A wide gap between the buying and selling price, called the spread, adds to the cost, particularly for smaller companies and trusts. Using limit orders can help to control the price paid. Investors should also check how many shares typically change hands each day.

Looking beyond a single payment

One dividend does not show a trend. Looking at several years of payments, the split between interim and final amounts, and any special payments gives a clearer picture of how reliable the income is. It is also worth checking whether the dividend has been funded from profit, from reserves or from borrowing, because only the first can be repeated indefinitely.

What to watch next

The next milestones are the interim results and the March interim dividend. Investors should follow funds under management, net flows and the Margin on fees. If the interim stays at 11p and the final rises again next year, the company would extend its record of annual increases, which would support the income case for LSE:CLIG.