Durig has developed the S&P Dividend Aristocrat Portfolio targeting both Aristocracy principle growth and very good diversified dividend income. The history of Dividend Aristocrats has been very rewarding over time as they have outperformed their peers. One constant issue that investors and clients love is that to be an Aristocratic the company must raise their dividend each and every year. It is our opinion that these companies have mandated that the shareholders come first, instead of overcompensation in the C suit of CFO, CEO, COO and so on. Currently the S&P Dividend Aristocrat rate is 4.42% and even though this has been a very tough year the portfolio has outperformed most income vehicles with the same income.
The Dividend Aristocrats over time have seen higher total returns with lower overall volatility, which is a beautiful combination that clients love. The Dividend Aristocrats have historically shown smaller draw-downs during recessions and the chart below shows the draw-down versus other income investment during the COVID Pandemic.
Higher total returns with lower volatility are typical characteristics, especially in the high dividend and income market described above. The lower volatility and higher income often give investors “peace of mind” but this might come with a price. Every investor should know that past performance is not a guarantee of future returns.
Below is a long term chart of Dividend Aristocrats vs The S&P:
How has the Durig’s S&P 500 Dividend Aristocrats portfolio performed in this Pandemic environment? It is still early but it appears the S&P 500 Dividend Aristocrats portfolio is slowly working the way we had hoped. This is a strategic investment with a long term approach, high dividends and even increasing income. The Dividend Aristocrats Portfolio has done very well in performance over time, and significantly outperformed fixed income funds with similar levels of income. Since the inception on 8-6-2019 it has a 3.38% total return but is still down this year 10.48%. The portfolio is rebalanced each quarter to ensure the income is high and the companies are still qualified under our criteria.
With Dividend Aristocrats you receive a much larger dividend income for taking S&P level company stock risk and rewards, plus you receive over 4% more than the 10-year treasury. This is an incredibly high premium for S&P strong performing, quality companies and that’s why we believe it’s positioned for a comeback.
Dividend Aristocrats Lifetime Performance 4-8-2020
The Dividend Aristocrats are S&P 500 index constituents that have increased their dividend payouts for 25 consecutive years.
Dividend Aristocrats of the S&P 500
Annual Cost: 0.50% or 1/8 of a percent per quarter.
Average Dividend Yield of About: 4.42%
Minimum Investment: $25,000
Minimum Holding Period: None
With Covid slowly coming under control and the global economy starting to advance again this could be a very good point for both income and principal appreciation.
If you’re thinking of stepping into the market we believe the Dividend Aristocrats deserve honest review. This could be the perfect investment for those seeking growth, good diversity, with high and growing income, but are willing to take principle risk knowing over time aristocrats have outperformed.
Additional Durig Portfolio’s
We offer our successful investment strategies of Dividend Aristocrats, along with are many Dogs Portfolios, to other Charles Schwab Registered Investment Advisors through segregated accounts.
Our price is the very low cost of only 1/2 a percent and the RIA can apply an additional fee that they believe is best situated for your clients and or your firm.