STOXX Global Select Dividend 100

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Global Select Dividend
Performance index
ISIN US26063Y1120
Price index
ISIN US26063V1180
100 shares

The STOXX® Global Select Dividend 100 is a share index of STOXX Ltd. based in Zurich , a subsidiary of Deutsche Börse AG . It comprises the stocks of 100 large companies from the STOXX Global 1800 Index with the highest dividend yield in North and South America, as well as in Asia and Europe. These are primarily companies from the finance industry ( banks and insurance companies ), real estate and energy industries . ETF funds that follow this index are therefore aimed at investors who are interested in regular high distributions ( dividend strategy ).

Selection criteria

The STOXX® Global Select Dividend 100 only includes companies that have paid a constant or increasing dividend over the past five years, but have not distributed more than 60 percent of their profits. This should ensure a special sustainability. Nevertheless, investment experts criticize that five years is not an “especially long time” and is therefore not sufficient as the sole quality criterion. In order to achieve global diversification, 40 companies from North and South America and 30 each from Asia / Pacific and Europe are represented.

composition

On April 30, 2019, the shares of financial service providers (19.1% banks, 10.3% insurers, 4.6% financial service providers), utilities (14.8%), real estate companies (12, 8%) dominated the STOXX® Global Select Dividend 100 . 8%) and telecommunications (8.3%). In addition, the industrial sector (4.7%) and oil / natural gas groups (5.9%) are strongly represented. Broken down by country, the index focuses on public companies based in the USA (23.59%), Australia (10.65%), Hong Kong (10.55%), and Singapore (9.94%). As of May 29, 2019, German companies were only represented with 2.37%, namely Munich Reinsurance (1.01%), Allianz SE (0.81%) and Deutsche Post AG (0.55%). As of May 29, 2019, the Australian raw materials supplier Fortescue Metals Group Ltd. held the highest shares in the index . (2.38%), the Scottish utility Scottish and Southern Energy PLC (1.91%), the UK water utility United Utilities Group and the Chinese telecommunications company PCCW (Pacific Century Cyberworks, 1.89%).

performance

At the start on January 4, 1999, the STOXX® Global Select Dividend 100 was calculated at 1025 basis points, a value that has never been undercut since then. The price index peaked on May 28, 2007 with 3212 points. Between April 2018 and April 2019 the index fluctuated between 2456.50 (December 27, 2018) and 2857.56 (April 29, 2019). The volatility is therefore lower compared to other international stock indices. The year-on-year performance in 2019 was 3.48% compared to 2.99% in the much broader Stoxx Global 1800 Index. Over the course of five years , it was 36.95% for the STOXX® Global Select Dividend 100 compared to 49.18% for the Stoxx Global 1800 .

The table shows the first time the next 1000-point mark has been exceeded on the basis of the closing price of the Global Select Dividend price index calculated since 1999 .

first
closing
over		 Final
score in points		 date
1000 1025 January 4, 1999
2000 2006 March 28, 2002
3000 3011 December 14, 2006

Taking into account the dividends on which this index focuses, the result is significantly different. The table shows the first time the next 1000-point mark has been exceeded on a closing price basis, the Global Select Dividend Performance Index, which has been calculated since 1999 .

first
closing
over		 Final
score in points		 date
1000 1025 January 4, 1999
2000 2001 May 14, 2001
3000 3001 May 24, 2005
4000 4023 October 12, 2006
5000 5033 4th September 2014
6000 6075 December 8, 2016
7000 7015 October 24, 2019

It can be seen that the prices of the values ​​contained in the index alone could triple over the period of 20 years (1999 to 2019), while the prices plus dividends (performance index) more than six-fold over the same period. Thus, the dividends are the decisive return factor in the long run. They account for more than three fifths of the total return in the period under review.

Even after 12 years, the pure price index as of October 2019, at around 2900 points, is still well below its all-time high from 2007, while the performance index marks new all-time highs almost daily at over 7000 points.

Exchange traded funds (ETF)

Investors who want to participate in the development of the STOXX® Global Select Dividend 100 with exchange-traded funds (ETF) can only choose between ETFs from Deutsche Bank and the asset manager BlackRock , with Deutsche Bank using synthetic indexes (through derivative financial instruments such as swaps ) , BlackRock physically (by buying shares). The annual costs of these two ETFs from Deutsche Bank (0.50%) and BlackRock (0.46%) are comparable.

rating

By Benjamin Graham developed and by Michael B. O'Higgins in his book Beating the Dow advanced dividend strategy is repeatedly criticized as "irrational" because dividend payments are psychologically supposedly rated higher by investors as equal gains. In addition, skeptics point out that the high dividend yield of a company alone does not say anything about its strength, but is a pure mathematical variable that can also be determined by a low share price. Share indices, which instead use the market capitalization of companies as a yardstick (i.e. the number of their shares and their prices), performed sometimes better and sometimes worse than dividend indices , according to a survey by the financial services provider Morningstar . Nonetheless, ETFs that follow the STOXX® Global Select Dividend 100 are most suitable for investors who are interested in regular high inflows with a manageable risk with international diversification. Such ETFs are therefore in demand as an alternative to bonds with low to negative interest rates.

Web links

Individual evidence

  1. ↑ Factsheets-Components 2017. stoxx.com, accessed on January 14, 2019 (English).
  2. ↑ a b STOXX® GLOBAL SELECT DIVIDEND 100 INDEX. stoxx.com, accessed on January 14, 2019 .
  3. ↑ a b Are ETFs the better dividend investments? Retrieved January 14, 2019 .
  4. ↑ a b Xtrackers Stoxx Global Select Dividend 100 Swap UCITS ETF. Retrieved January 14, 2019 .
  5. ↑ STOXX: STOXX Digital | STOXX® Global Select Dividend 100 price index. Retrieved October 27, 2019 .
  6. ↑ STOXX: STOXX Digital | STOXX® Global Select Dividend 100 performance index. Retrieved October 27, 2019 .
  7. ↑ ETF search and ETF comparisons | justETF. Retrieved January 14, 2019 .
  8. ↑ a b Dividend at a glance: What are dividend strategies good for? March 5, 2017, accessed January 14, 2019 .
  9. ↑ Distributing ETF - low risk, high dividend. In: banking secrecy. August 19, 2017. Retrieved March 29, 2019 .
  10. ^ Hermann-Josef Tenhagen : Index funds are becoming more popular: The right investment for normal savers . In: Spiegel Online . April 28, 2018 ( spiegel.de [accessed March 29, 2019]).