The ASX dividend stock Future Generation Global Ltd (ASX: FGG) is not one of the most famous names on the ASX, but I think it's one that income-focused investors should closely look at.
At a time when interest rates keep on rising, I don't think the dividend yields on offer from stocks like Commonwealth Bank of Australia (ASX: CBA) are high enough.
According to the projection on CMC Invest, the FY27 CBA grossed-up dividend yield could be 4.4%, including franking credits, based on a forecast of $5.20 dividend per share. A $4,000 investment would only unlock $176 of annual grossed-up income (including franking credits).
In my view, the listed investment company (LIC) Future Generation Global is a much more appealing offering for dividend income.
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Appealing dividend attributes
There are a couple of key elements I like to look for when considering ASX dividend stocks.
Firstly, dividend reliability. If I'm investing for dividends to cover living expenses, I want a high degree of confidence that the payments will continue to flow through good times and bad. Of course, dividends are not guaranteed payments like cash in the bank.
Future Generation Global started paying dividends in 2016 and hasn't ever cut its payout. The LIC has increased its regular annual dividend each year since 2019. Commonwealth Bank cut its dividend in 2020.
LICs can build up profit reserves during good years (while paying dividends) and fund stable dividends during weaker years.
Secondly, Future Generation Global has a much higher dividend yield than CBA's grossed-up 4.4%. The LIC has advised it will pay an annual dividend of 8.4 cents per share for the 2026 financial year, translating into a grossed-up dividend yield of 7.4%, including franking credits. In August, it reconfirmed its dividend guidance in its FY26 half-year result.
As of September 2026, the business had a profit reserve of 66.5 cents per share, which is more than seven years of dividend coverage.
Diversification
The Future Generation Global business model is to invest in funds managed by 15 different fund managers that use different strategies.
Some of those fund managers include Antipodes, Yarra Capital Management, Munro, Vinva, WCM, Plato, Cooper Investors, Life Cycle, GCQ, Ellerston Capital, Paradice, Langdon and Morphic.
It's invested in some of the world's strongest businesses, such as Nvidia, Microsoft and Amazon. But with the fund managers seeking growth, it has greater exposure to medium- and small-sized (by global standards) businesses than the global index (MSCI World Index).
The portfolio is invested across a number of markets including North America, the UK, Europe, Asia, other developed markets and emerging markets.
As you can see, with just one investment, we're getting appealing exposure to the global stock market. That's more appealing to me than just owning CBA shares.
Charitable donations
One of the best things about the LIC is that it donates 1% of its net assets each year to youth mental health charities such as Back Track, Big hART, Happy Paws Happy Hearts, Human Nature, I Can, Life4Life, Reachout, Prevention United, Youth Opportunities and Project Rockit
It manages to fund those donations because all of the fund managers involved work pro bono (for free).
As the ASX dividend stock grows over time, the annual donations can increase as well. I'm pleased to think I'm involved in a very small portion of the donations going to those charities.
With a combination of good dividends, diversification, and charitable donations, there are strong reasons to like this ASX dividend stock. At the time of writing, the share price is $1.63; I'd love to buy 2,453 shares with $4,000 today.
