Tag Archives: dividends

Dividend Volatility and Correlations

Equity markets are notoriously volatile, at least when compared to fixed income. Dividend payments, by contrast, while not fixed like many bond coupons, offer  market participants a much less volatile and more fixed income-like risk and return profile.  For the 25 years from 1990 to 2015, the annual variation in S&P 500® dividend points has Read more […]

A Closer Look at Payout Ratios and Earnings

Beyond the growth in nominal GDP, the other two macro-factors that may influence the returns of the S&P 500® Dividends Index: payout ratios and corporate earnings. When corporations make profits, they have a choice: They can either reward shareholders or they can retain and reinvest the earnings.  While some companies, notably fast-growing technology firms, opt Read more […]

A simple model of aggregate dividend growth

Dividends are getting more and more into the spotlight as overall corporate earnings growth continues to face many challenges in a low inflation and relatively slowly growing world.  And, a U.S. Treasury 10-year note yield of sub-2% certainly adds interest to the dividends that can be earned from S&P 500® companies.  And, dividends may also Read more […]

Accessing China’s Growth via Dividends

In the current environment of short-term volatility amid a long-term positive outlook for the Chinese economy, a focus on growing, sustainable dividends in China’s equity markets could provide the opportunity to get a slice of the region’s structural growth and potential downside protection compared with a typical growth strategy, such as an earnings growth strategy. Read more […]

The Tale of Dividend in India

Dividend yield is an important source of total return from an investment in equities. The other source is capital gains. While capital gains tend to be volatile and depend on the stock price movement in the market, dividend income tends to remain stable and depends on the dividend distribution policy of the company. The dividend Read more […]

Why U.S. Investors Are Turning to Europe

The New York-listed iShares Europe 350 ETF has more than doubled in size in the past six months; the front page of last Friday’s Financial Times reported that U.S. purchases of European equities have surged, while the Wall Street Journal noted yesterday that “Europe is back.” European equities have underperformed U.S. equities by around 45% Read more […]

Dividends Matter

This morning’s Wall Street Journal brought word that the Dow Jones Industrial Average, which reached nominal all-times highs earlier this month, was in fact still 1% below “the record that counts,” which record is argued to be the all-time high in inflation-adjusted terms.  The analysis uses the price of the Dow Industrials (e.g., last Friday’s Read more […]

Are Dividends the Answer to Growth for Income Hunters?

Dividend focused strategies as well as strategies offering exposure to alternative income sources have become popular and proliferated over the past few years given the low interest rate environment.  Throughout history, dividends constitute an important part of total equity return. In decades such as the 40s and the 70s, dividends constitute 50% or more of Read more […]