An extra $3.4 billion has been drained in dividends in the past year, according to Perpetual. In the latest half-year alone, Hyperion Asset Management's portfolio manager, Justin Woerner, says dividends per share climbed 8.2 per cent, three times the inflation rate.

"In the last two years, dividend investing has become the new black, and it's DIY super fund-driven," says Elio D'Amato, chief executive of research house and fund manager Lincoln.

In other times, some, maybe even most, of that would have been ploughed back into the company either as capital spending or a takeover.

And here's one for the books. The biggest dividend growth is coming from mining stocks, admittedly off a low base.

The average payout ratio of industrial stocks has reached 70 per cent of profits, compared with the more normal 60 per cent, John Grace, a portfolio manager at Ausbil Investment Management, told a recent Morningstar DIY super conference.

So is the dividend kitty about to run out?

Apparently not for a while yet. The economy is picking up, and after years of cost-cutting and downsizing, extra sales revenue will flow straight through to profits.

Also, interest rates are still ultra-low, and while a high payout ratio means less is being reinvested in the company, that won't hurt future earnings for some time.

Besides, companies are still sitting on a pile of cash, show no interest in investing and don't have to pay off debt.

"Gearing by companies is near a record low," Grace says.

Perhaps the most conspicuous example of grey power, represented behind the scenes by influential fund managers who look after pension funds, is BHP Billiton, a stock perennially criticised for hoarding cash.

But it's adopted what it calls a "progressive dividend policy". This means each dividend is either higher than the one before it, or at least the same in US cents (it records its profit in US dollars and so can hardly be accountable for the swings in the Australian dollar).

Even Telstra has at long last lifted its dividend, though so far only by half a cent.

There's a salutary lesson to dividend-chasers here. BHP shares have always cost a lot more, and so the yield from the dividend has trailed Telstra's by a long stretch. BHP shares bought in 2004 for $14.20 each were yielding a paltry 2.1 per cent, one-third of Telstra's 6.9 per cent.

So if you were going for yield, which stock would you have bought? Telstra, of course. Sorry. You would have made a costly mistake. Over that time, BHP shares have almost trebled in value. Telstra's shares, on the other hand, are worth no more than they were then.

Plus, over the past decade BHP has paid out $777 in dividends for each share held, compared with Telstra's $263. Both, by the way, were fully franked and so come with a 30 per cent tax credit that, for taxpayers in the 15 per cent bracket and super funds, becomes a cash refund. So not only did the value of BHP's dividend rise much faster than Telstra's, so did its share price.

That's typical of stocks with rising dividends. In 10 years, the share price of Woolies rose 150 per cent, but its dividend climbed 250 per cent. Even while its share price was fluctuating the dividend grew steadily.

There's another lesson, too. A stock with a low payout ratio but growing profits is better than one with a higher dividend based solely on a high payout ratio. High-dividend stocks can be safer in a market downturn, though there's no ironclad guarantee, as the banks so spectacularly showed during the global financial crisis. To make things worse, they were raising capital by issuing new shares as well - a double-whammy for shareholders of falling prices and dividends.

In truth, being too dividend-focused is risky.

A stock might have an unusually high yield not because it's lifted its dividend, but because its price has been marked down for good reason. That, in turn, would show the market expects the dividend to be cut or dispensed with altogether.

Take one of the best-yielding stocks in the accompanying table from Lincoln Indicators, Metcash, which will yield 10 per cent if it holds its dividend.

But the consensus among analysts is this will be cut, pulling the yield down to a still respectable 6.9 per cent.

Almost as dangerous as the yield trap is a high payout ratio. If the proportion of profits paid out is above 85 per cent, and especially over 100 per cent, the chances are the dividend won't be sustainable.

That said, the yield might be high because a stock is what Mark Thomas, chief executive of van Eyk Research, calls a "slug". These are cash cows, usually mature businesses, that won't grow a lot. Think utilities.

The most promising dividend-payer in the table is NRW Holdings, which, like all mining services companies, has had its share price savaged.

But the consensus forecast, based on its current share price, is that the yield will rise from 8 to 8.9 per cent (or 12.7 per cent after franking).

DIY funds adore franking. It isn't everything, though - let's face it - it is a lot.

Several real estate investment trusts (REITs) have unfranked yields around 8 per cent, as the table shows.

"Their yields are near the top of the tree because share prices have gone up and REITs haven't," D'Amato says.

The potential for the share price to fall is why you shouldn't put all your dividends in one basket, either.

An easy way around this is with the half-dozen exchange-traded funds (ETFs) that invest in high-dividend-paying shares.

These are like managed funds except with much lower fees, trading on the ASX.

Mind you, they have their own quirks, too.

"With the State Street (SYI) one, more than half the portfolio is in financial stocks. But with the iShares ETF (IHD) that sector might be capped at 20 per cent. So it will be a lot more diversified, but will also have a lot more smaller companies," says Dan Miles, managing director of Innova Asset Management.

As it happens, they have similar returns, according to research house AltaVista, which analyses ETFs.

AltaVista forecasts yields this financial year to range between 5 and 5.6 per cent, and in 2014-15 between 5.2 and 5.9 per cent.

Although Vanguard (VHY) has the lowest fee and one of the best yields, its underlying stocks are also relatively expensive, suggesting less growth potential.

For both years the best performer is likely to be DIV, despite its higher annual fee of 0.7 per cent. DIV is a new ETF started by wealth manager and broker UBS a few months ago.

But again, yield isn't everything.

"How inexpensive or relatively undervalued an asset is is also relevant, as is the earnings power of the underlying stocks within the ETF," says Michael Turner, AltaVista's head of sales and corporate development.

On two other critical measures - price relative to book value and earnings - DIV also comes out ahead.

Still, even high-dividend ETFs can drop in value, because they don't have the best stocks or they have moved with the market. The rule remains that stocks with the best yield are the least likely to grow in value.

Ka-ching! Welcome to the Aussie banks' payout party

The banks are about to host another dividend feast, and you're invited.

ANZ starts the banks' interim reporting season on May 1, and lenders are widely expected to follow the Commonwealth Bank's lead earlier this year, when it lifted its dividend 12 per cent.

''Dividends will rise in line with earnings growth, which we expect to be in the low single-digits over the next couple of years,'' says Andrew Doherty, joint head of equities at Morningstar.

The banks' dividend-paying season also offers a popular yield play producing a return of up to 13 per cent in just over a year after taking franking into account.

The trick is to buy a bank stock just before the dividend is declared and hold it for 13 months so as to collect three payouts.

True, there's a risk their share price could drop in the meantime - and nobody says the banks are cheap.

At least home loans are picking up, which will lift profits.

Even before taking into account the likely rise in dividends next month, bank stocks are yielding between 4.6 per cent and a high of 6.6 per cent in Suncorp's case, which, after franking, is a pre-tax return between 6.6 per cent and 9.4 per cent. These returns are double those the banks pay their depositors.

Also helping are their dividend reinvestment schemes that let them issue more shares instead of a cash payment.

About one-quarter of the banks' payouts are recycled through their dividend reinvestment schemes, thanks to the shareholders who opt for scrip instead of cash.

But this can have its downside. While Westpac buys the shares it is going to issue, so no new ones are created, that's not the case with the Commonwealth.

Analysts expect the banks to continue paying high dividends, but aren't so sure about their share prices, which are considered expensive.

Or are they? At its strategy day for DIY super funds, Peter Warnes, head of equities research at Morningstar, said trustees had been proved correct in buying bank stocks.

''They'll have a sustainable competitive advantage for a long time. Their assets are loans, not property, so their income streams are diversified between lawyers, accountants and so on. Bankers are conservative, so they won't be silly with the dividend either,'' he says. The world's biggest bank by value is the US-based Wells Fargo, which ''has a 29.6 per cent dividend payout ratio and 12.2 per cent return on equity. The Commonwealth Bank has an 18.3 per cent return on equity and a 75 per cent payout, but with its dividend reinvestment plan it has surplus capital'', underpinning its financial strength.