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Can A Dividend Growth Portfolio Beat Index Funds?

Published Mon, 15 Oct 2018 15:29:43 -0400 on Seeking Alpha

If Dividend Growth Investing can beat Index investing, where is the portfolio that shows this? In the various debates about whether or not Dividend Growth Investing is a viable strategy and how it stacks up to Index Investing, one question is often raised by proponents of Index Investing. And that question is, where are all the DG portfolios that beat Index Investing?
While the answer is complex, it is a fair question. I know with my own portfolio ( here is the latest update) is not currently beating the indexes I have compared it to. Part of that is due to the short time frame it has been in existence. Part of that is due to my directing cash flows into sectors and stocks where prices were falling while the indexes are doing the opposite. I bought all good companies and by purchasing them when prices were low I was able to grow dividend income faster. I fully expect this to pay off down the road. But I don’t expect my portfolio to beat the comparison indexes each year in total return. While I don't worry about it very much, I do expect that over the long term dividend growth will result in price growth too.
Understand as well that actual investors who use index funds under-perform their indexes. That may sound counter-intuitive. But actual investors tend to buy more shares of funds that are going up and sell shares of funds that are going down in price. This can and often does lead to investors buying high and selling low. So it’s not just investors who buy... Read more

Stock name Last trade   P/E Earnings/Share Dividend/Share Dividend yield
AT&T 30.62   5.8 5.29 2.04 6.61
IBM 121.62   19.6 6.22 6.28 5.22
DOMINION RESOURCES 67.97   13.6 5.01 3.34 4.78
EXXON MOBIL 71.63   13.2 5.44 3.28 4.57
REALTY INCOME 64.65   54.3 1.19 2.65 4.15
WELLS FARGO 47.67   10.9 4.39 1.72 3.59
COCA-COLA 46.92   72.2 0.65 1.56 3.31
JM SMUCKER 103.23   8.8 11.79 3.40 3.31
WISCONSIN ENERGY 70.29   17.3 4.06 2.36 3.22
LOCKHEED MARTIN 272.39   24.8 10.96 8.80 3.17
PROCTER & GAMBLE 92.01   24.1 3.82 2.87 3.13
3M 188.94   25.3 7.48 5.44 2.83
JOHNSON & JOHNSON 128.04   256.1 0.50 3.60 2.81
SPDR S&P DIVIDEND ETF 91.44   0.0 0.00 2.44 2.72
COLGATE PALMOLIVE 61.61   25.5 2.42 1.68 2.71
MCDONALDS 179.35   27.2 6.59 4.64 2.56
CLOROX 152.62   23.8 6.42 3.84 2.50
WAL-MART STORES 96.25   55.3 1.74 2.08 2.19
SPDR S&P 500 ETF 260.98   0.0 0.00 5.10 1.98
MICROSOFT 105.38   43.7 2.41 1.84 1.80
POWERSHARES QQQ TRUST SERIES 1 162.38   0.0 0.00 1.41 0.87
GENERAL ELECTRIC 8.98   0.0 -3.82 0.04 0.45
ISHARES BARCLAYS AGGREGATE BOND FUND  

AT&T - T
AT&T - T  


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Dividend Dogs Vs. Index - Episode 1
Barron's List Of Best Yield Plays For 2019 Turns To Verizon For Safety
Barron's Says To Buy MLPs In 2019, Yet Its Best Yield Plays Favor Vodafone
Income Investors: Should You Buy Higher Dividends Or Dividend Growth In 2019?
Bert's December Dividend Income Summary - A New Record!
My Dividend Growth Portfolio 2018 Review: 3 Sells, 6 Buys
Paying My Bills With Dividends - Q4 2018 Update
John And Jane's Taxable Account Dividend Increases And Income Tracker - The Apple Effect
Dividend Growth 50: More In Year 4, With Income Up 10% - Part 2
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