Rising Dividend Strategy for Financial Advisors

A time-tested strategy for potentially increasing equity income

Rising Dividend Portfolios

The Core Rising Dividend separately managed account portfolio invests in companies diversified across numerous sectors, which offer the potential for a yield greater than that offered by the S&P 500, plus the potential for mid- to high-single digit annual dividend growth over the long term. The combination of a current yield greater than the S&P 500 plus the potential for dividend increases offers investors a portfolio that we believe will perform well in both rising and falling markets.

Core Rising Fact Sheet      Core Rising Dividend Income Report  

The High & Rising Dividend separately managed account portfolio invests in companies diversified across numerous sectors, which offer the potential for a yield greater than that offered by the S&P 500, plus the potential for mid-single digit annual dividend growth over the long term. The combination of a current yield greater than the S&P 500 plus the potential for dividend increases offers investors a portfolio that we believe will perform well in both rising and falling markets.

High & Rising Fact Sheet      High & Rising Dividend Income Report  

Dearborn Partners offers a Rising Dividend Mutual Fund. Please click the link below.

 

Dearborn Partners Rising Dividend Mutual Fund

The Core Rising Dividend separately managed account portfolio invests in companies diversified across numerous sectors, which offer the potential for a yield greater than that offered by the S&P 500, plus the potential for mid- to high-single digit annual dividend growth over the long term. The combination of a current yield greater than the S&P 500 plus the potential for dividend increases offers investors a portfolio that we believe will perform well in both rising and falling markets.

Core Rising Fact Sheet      Core Rising Dividend Income Report  

The High & Rising Dividend separately managed account portfolio invests in companies diversified across numerous sectors, which offer the potential for a yield greater than that offered by the S&P 500, plus the potential for mid-single digit annual dividend growth over the long term. The combination of a current yield greater than the S&P 500 plus the potential for dividend increases offers investors a portfolio that we believe will perform well in both rising and falling markets.

High & Rising Fact Sheet      High & Rising Dividend Income Report  

Dearborn Partners offers a Rising Dividend Mutual Fund. Please click the link below.

 

Dearborn Partners Rising Dividend Mutual Fund

 

Our Rising Dividend Strategy

Investing in a diversified mix of rising dividend companies can, in our opinion, provide a defensive ballast to an investment portfolio. Rising dividend portfolios offer the potential not only to provide investors with a current income stream but one that can increase over time, while offering a prudent way to participate in the wealth-building potential offered by the stocks of high quality companies over the long term. The Rising Dividend portfolios are co-managed by Carol M. Lippman, CFA and Michael B. Andelman.

 

Our Approach

In the early 1990s, Carol spent many months researching weekly market data from 1934 to 1989. She discovered that stocks of companies that consistently raised dividends each year did not go down as much in bad markets as did stocks of companies that either paid no dividend at all or did not raise their dividends. As a result of her research, Carol began this strategy in the early 1990s, at the dawn of the dot-com era. At the time, few investment strategies emphasized dividends. As a result of the fortunes lost—twice in one decade—from three consecutive years of negative stock market returns after the dot-com bubble burst in year 2000, and then the financial crisis of 2008, now there are many strategies emphasizing dividends.

 

 

Two primary differences distinguish the Dearborn Partners Rising Dividend Strategy from others: Many of the dividend strategies now available emphasize high yields. Our work shows that high yields frequently indicate high levels of risk, including the risk that the dividend may not be sustainable. Instead, we look for attractive current yields with prospects for dependable dividend growth. Next, many of the current dividend strategies are based on screens of companies with a record of a certain number of years of past dividend increases. Markets trade on the future, not the past. Our strategy attempts to uncover companies for which we have a high degree of confidence that the companies offer the potential for dependable, regular dividend increases.

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