The power of dividend investing has been extensively researched. Dividend-paying firms have typically outperformed non-dividend paying companies over long time periods while also helping to dampen volatility and offset the drag of inflation.1
But performance of dividend strategies can vary widely across different market and economic cycles. Therefore, diversification is very important when making equity income a key component on long-term portfolios and retirement income planning solutions.
That’s why we constructed a suite of dividend strategies to capture the major styles of dividend investing. They are designed to complement each other with little overlap in companies across strategies, ensuring that clients do not end up holding concentrated positions in the same securities.
We target companies that have high earnings quality, reasonable valuations, and the financial stability to sustain and grow their dividends. Some of these firms are also backed by real world physical assets, forming the kind of moats that are harder for artificial intelligence to disrupt.
Based on our reading of long-term macro conditions, we believe that dividend equities should form the spine of core value equity holdings within diversified portfolios. Our dividend suite provides the kind of rigor and diversification that enables advisors to flexibly combine our strategies to suit a variety of client objectives and retirement income needs.