The ProShares S&P 500 Aristocrats ETF follows the S&P Dividend Aristocrats Index, which is comprised of S&P 500 companies that have increased their dividends for at least 25 consecutive years. NOBL has a 2.16% 30-day SEC yield.
[related_stories]The three dividend growth ETFs may be a better way for investors to capture the three market capitalization asset categories. Among dividend paying companies, those that have consistently increased dividends are ranked among an elite group of dividend payers. In recent years, these companies that have steadily raised dividends also outperformed firms that did not.
For instance, looking at Russell 3000 companies between 1987 and the end of 2015, dividend growing companies returned an average 13.4%, whereas other dividend payers returned 11.9%, non-paying companies returned 7.1% and dividend cutters saw a 6.7% return. Financial advisors who are interested in learning more about dividend growth investments can watch the webcast here on demand.
Simeon Hyman, Head of Investment Strategy at ProShares, also pointed out that dividend growers include a high quality group of stocks that exhibit strong balance sheets and sustainable growth.
“Dividends are often viewed as a reflection of management confidence in the company’s earnings, balance sheet and performance potential,” Hyman said. “Cutting or suspending dividends is probably one of the things Wall Street hates the most, as it may be a signal of cash flow or debt problems for a company. Paying dividends is generally considered a sign of stability and a commitment from management to returning cash to their shareholders.”