Global Dividend Aristocrats Target Stocks with a Long-Term Track Record
Market sentiment continues to favour an economic recovery in 2021, as vaccination programs help support a pickup in business activity.
Companies are keen to renew their commitments on returning capital to shareholders through the dividend.
A stable dividend strategy, such as the Global Dividend Aristocrats index tracked by SPDR® ETFs, aims to offer investors strong yield factor exposure through higher quality stocks from a diverse range of sectors.
Current Economic Landscape Favours Return to Dividend Strategies
The current economic sentiment provides a supportive case for dividend stocks based on recent earnings guidance, analyst projections and general optimism toward a continued economic recovery. This environment could present an opportunity for global equity investors using UCITS ETFs to return to dividend strategies, following momentum seen in other recovery plays. Global equity investors heard a number of positive themes this earnings season, which helped shape the future estimates on forward dividends.
The S&P® Global Dividend Aristocrats Quality Income Index (“Global Dividend Aristocrats”) selects high yielding stocks that have a long-term track record (at least 10 consecutive years) of maintaining or raising the total dividend per share amount every year. By adding Global Dividend Aristocrats to the portfolio, investors can increase exposure to stocks forecasting increasing or stable dividend yields, both in terms of nominal stock count (Figure 1) and overall portfolio exposure (Figure 2).
Figure 1: Total Number of Stocks by Forecast Action
Source: Bloomberg Finance L.P., as of 19 April 2021. The above targets are estimates based on certain assumptions and analysis made by Bloomberg Finance L.P.. There is no guarantee that the estimates will be achieved.
Figure 2: Total Portfolio Exposure by Forecast Action
Source: Bloomberg Finance L.P., as of 19 April 2021.The above targets are estimates based on certain assumptions and analysis made by Bloomberg Finance L.P.. There is no guarantee that the estimates will be achieved.
The Global Dividend Aristocrats index uses a flexible approach to targeting quality income, which allows the strategy to go ‘wherever it needs’ to find long-term stable dividends. As a result, the index will often tilt toward sectors such as Financials, Utilities, Consumer Staples and Real Estate. Each of these sectors presents opportunities for investors to target stocks that are both increasing and maintaining short-term dividend yields (Figure 3).
Figure 3: Total Portfolio Exposure by Forecast Action and Sector
Source: Bloomberg Finance L.P. as of 19 April 2021. The X-axis represents portfolio weight. The data labels are stock counts for each forecast category. The above targets are estimates based on certain assumptions and analysis made by Bloomberg Finance L.P.. There is no guarantee that the estimates will be achieved.
How to Play this Theme
In one simple trade, investors who are optimistic about the economic momentum behind dividend stocks and who are seeking to add yield factor exposure to the portfolio can trade the SPDR® S&P® Global Dividend Aristocrats UCITS ETF. The S&P® Global Dividend Aristocrats Quality Income Index offers an indicative yield premium of 3%1 over the MSCI ACWI Index as of April 2021. To learn more about this ETF, and to view full performance history, please visit the fund page .
To learn more about Q1 factor performance, ETF flows, institutional style flows and holdings, as well as fundamentals and correlations, we invite you to read out Q2 Smart Beta Compass .
Source: Bloomberg Finance L.P., for the period 22-29 April 2021. Flows are as of date indicated and should not be relied upon as current thereafter. This information should not be considered a recommendation to invest in a particular sector or to buy or sell any security shown. It is not known whether the sectors or securities shown will be profitable in the future
1Source: State Street Global Advisors, FactSet, as of 19 April 2021.
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ETF's worden verhandeld zoals aandelen, zijn onderhevig aan beleggingsrisico, fluctueren in marktwaarde en kunnen worden verhandeld tegen prijzen boven of onder de netto-inventariswaarde van de ETF’s. Brokercommissies en kosten van de ETF zullen het rendement verminderen. De wijzigingen in wisselkoersen kunnen een nadelig effect hebben op de waarde, prijs of inkomsten van een belegging. Verder is er geen garantie dat een ETF zijn beleggingsdoelstellingen zal behalen.
DE SPDR-ETF'S VAN SSGA ZIJN MOGELIJK NIET BESCHIKBAAR OF GESCHIKT VOOR U. DE UITGEDRUKTE MENINGEN/INFORMATIE OP DEZE SITE VORMEN GEEN BELEGGINGSADVIES, FINANCIEEL, JURIDISCH, REGLEMENTAIR, BOEKHOUDKUNDIG OF BELASTINGADVIES. BIJ TWIJFEL DIENT MEN STEEDS ONAFHANKELIJK ADVIES IN TE WINNEN. DE INFORMATIE NOCH ENIGE OPINIE OP DEZE SITE VORMT EEN VERZOEK OF AANBOD VOOR DE AAN- OF VERKOOP VAN AANDELEN VAN DE FONDSEN OF ENIG ANDER FINANCIEEL INSTRUMENT.Standard & Poor’s®, S&P® en SPDR® zijn gedeponeerde handelsmerken van Standard & Poor's Financial Services LLC (S&P); Dow Jones is een gedeponeerd handelsmerk van Dow Jones Trademark Holdings LLC (Dow Jones); en deze handelsmerken zijn in licentie gegeven voor gebruik door S&P Dow Jones Indices LLC (SPDJI) en in sublicentie voor bepaalde doeleinden door State Street Corporation. De financiële producten van State Street Corporation worden niet gesponsord, bekrachtigd, verkocht of gepromoot door SPDJI, Dow Jones, S&P, hun respectieve filialen en externe licentiegevers, en geen van deze partijen doen enige verklaring over de raadzaamheid om te beleggen in dergelijke producten, noch aanvaarden zij enige aansprakelijkheid in verband hiermee, inclusief voor fouten, weglatingen of onderbrekingen van een index.
SPDR-ETF's mogen enkel worden aangeboden en verkocht in rechtsgebieden waar dat is toegelaten in overeenstemming met de geldende regels.
Informatie met betrekking tot Mexico
Deze informatie is geen marketing of aanbieding van effecten en is niet ook niet zo bedoeld, en mag bijgevolg niet als dusdanig worden opgevat. De fondsen waarnaar in dit document wordt verwezen, zijn niet en zullen niet worden geregistreerd onder de Mexicaanse wet op de effectenmarkten (Ley del Mercado de Valores) en mogen in Mexico niet aan het publiek worden aangeboden of verkocht. De documentatie met bekendmakingen in verband met een van de bovengenoemde fondsen mag niet openbaar worden verspreid in Mexico en aandelen van de fondsen mogen niet worden verhandeld in Mexico.
SSGA SPDR ETFs Europe I Plc en SSGA SPDR ETFs Europe II Plc zijn beleggingsmaatschappijen met variabel kapitaal opgericht als fondsen met afzonderlijke aansprakelijkheid tussen de compartimenten volgens de wetten van Ierland en erkend door de Central Bank of Ireland conform de Europese verordening van 2011 over instellingen voor collectieve belegging in effecten. U moet het prospectus en de essentiële beleggersinformatie (KIID) met betrekking tot specifieke SPDR-ETF's aanvragen en zorgvuldig lezen alvorens u belegt. Voor meer informatie en het prospectus/KIID met de kenmerken, kosten en risico's van SPDR-ETF's kunt u nu een prospectus of KIID downloaden, of kunt u deze documenten verkrijgen bij uw financieel adviseur of bij uw lokale SSGA-kantoor.
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Alvorens u belegt, moet u de beleggingsdoelstellingen, risico's, vergoedingen en kosten van de fondsen in overweging nemen. Een prospectus met deze en andere informatie kunt u downloaden of aanvragen bij uw financieel adviseur. Lees het zorgvuldig alvorens te beleggen.
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