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The S&P 500 Dividend Aristocrats Index, which combines the shares of so-called dividend aristocrats, has fallen by 0.7% since the beginning of the year, while US S&P 500 companies with the largest capitalisation have risen by 7.3%, The Wall Street Journal writes. This year's level of the dividend aristocrats’ gap from the wider market is approaching a level that has not been seen since 2007, the publication notes.
The "dividend aristocrats" include companies from the S&P 500, which have been paying and increasing dividends for at least 25 years. The papers of the "aristocrats" index companies have recently generated about 2.7 per cent of dividend yield, compared to 1.7 per cent for the S&P 500. However, this was not enough to convince investors. They took more than $40 billion from dividend-focused mutual funds and ETFs in 2020, WSJ notes citing Emerging Portfolio Fund Research. The outflow for approximately the same period last year was only $3 billion.
Investors are in no hurry to return to them even though they have fewer ways to generate high returns due to record low interest rates around the world, WSJ says. Many investors are afraid that companies that usually share profits steadily with shareholders will change their policies and prefer "dividend aristocrats" to technology companies that have recovered from the crisis faster than others, the publication notes.
source: wsj.com
The "dividend aristocrats" include companies from the S&P 500, which have been paying and increasing dividends for at least 25 years. The papers of the "aristocrats" index companies have recently generated about 2.7 per cent of dividend yield, compared to 1.7 per cent for the S&P 500. However, this was not enough to convince investors. They took more than $40 billion from dividend-focused mutual funds and ETFs in 2020, WSJ notes citing Emerging Portfolio Fund Research. The outflow for approximately the same period last year was only $3 billion.
Investors are in no hurry to return to them even though they have fewer ways to generate high returns due to record low interest rates around the world, WSJ says. Many investors are afraid that companies that usually share profits steadily with shareholders will change their policies and prefer "dividend aristocrats" to technology companies that have recovered from the crisis faster than others, the publication notes.
source: wsj.com
