By Mary Gahan BBC News Online business reporter

Hiding money under the mattress might seem the best option when the other choices at the moment are low interest rates on savings accounts and wobbly shares.

But now could be the time to get back into the stock market, according to the professional investors.

A few weeks ago shares in London were worth about half their value at the height of the stock market boom and have since moved only a little higher.

You can get blue-chip stocks yielding more than government bonds and you get opportunities like this very infrequently Sacha Sadan, Gartmore Investment Management

The attraction of buying again is to do with the dividends companies pay to their shareholders - and the value of those dividends in relation to the share price.

The return, or dividend yield, on the FTSE All Share index has risen to 4.23% this month.

That is more than the interest rate on a typical savings account and more than the return on 10-year government bonds.

"Now, if you sell equities and buy bonds you are not getting a yield pick-up, so why do it?" asks Alan Custis, head of large UK stocks at JP Morgan Fleming Asset Management.

He says the last time the dividend yield was at this sort of level was in 1959.

Insurance sell-off

Typically dividend yields rise when share prices fall, making the shares better value.

As the FTSE 100 falls, dividend yields rise in a mirror image

For example, if a company's share price is 100 pence and it pays a dividend of 4p it has a dividend yield of 4%. If the share price falls to 50p and it continues to pay a 4p dividend, the yield rises to 8%.

The only caveat would be for most technology or "growth" shares, such as Lastminute.com, which do not yet pay out a dividend.

Last year the London stock market was one of the worst performing in the world, with the FTSE 100 index of blue-chip shares losing nearly a quarter of their value; and shares have continued to slide since then.

The UK markets were driven lower because insurance companies were forced to sell large amounts of equities to give them enough cash to cover pay-outs on policies.

'No debt splurge'

Traditionally, bonds have offered investors a safe place to park their money in turbulent conditions, but shares are becoming more attractive again.

"The market is very good value," says Sacha Sadan, UK equity fund manager at Gartmore Investment Management.

Buying yield on its own is not necessarily a recipe for making money Alan Custis, JP Morgan Fleming Asset Management

"You can get blue-chip stocks yielding more than government bonds and you get opportunities like this very infrequently."

Mr Custis highlights the difference between the London and New York markets.

"UK plc has not gone on the debt splurge that US companies went on. The bottom line of this whole argument is that the growth in dividends is sustainable."

Shares can still fall

He points out that big companies, such as Unilever, AstraZeneca and BP have all reported profits that were better than expected.

All of the great bull markets over time are associated with high dividend yields David Schwartz, Stock market historian

And even though some firms are cutting dividend payments he says there are more risers than fallers.

Lloyds TSB, for example, has a dividend yield of 8.5% even though its profit figures were weak.

And Abbey National, which announced a dividend cut, still has a yield of more than 5%.

But he warns: "Buying yield on its own is not necessarily a recipe for making money.

"With Invensys, if you'd just chased yield you'd have dropped 50% on the shares."

Investors would also have to buy shares at a low price to capitalise on a high yield.

War cloud

History also seems to provide a valuable lesson.

"A high dividend yield is good for shares there's no question about it," says stock market historian David Schwartz.

"All of the great bull markets over time are associated with high dividend yields; the better it gets, the more investors are keen to move into equities instead of bonds or gilts."

But he says: "Using the dividend yield to predict where shares are going to be three months from today is absolutely useless."

The feeling that shares are relatively cheap seems to be backed up by as survey of global fund managers by Merrill Lynch.

It found that nearly half believed world stock markets were undervalued, with another 38% saying they were fair value.

So, if shares are such good value, why have they not risen more strongly as investors have come back to the market?