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Wednesday, August 27, 2008

International Dividend Achievers for diversification

So far I have concentrated my attention primarily on the Dividend Aristocrats and the High-Yield Dividend aristocrats, both published by the S&P. Those lists include companies which are members of the S&P 1500 and which have raised their dividends for more than 25 consecutive years. I have also tried investigating the Broad Dividend Achievers as well, which are stocks that have increased their dividends for at least ten consecutive years.

That wasn't enough for me, however. In my quest for creating a diversified portfolio I have been searching for international dividend growers. There are several lists out there that focus on international dividend growth stocks – Mergents International Dividend Achievers index, S&P/TSX Canadian Dividend Aristocrats, S&P Europe 350 Dividend Aristocrats (EUR).
The list that caught my attention was the International Dividend Achievers list, prepared by Mergent Inc. It is broader than the S&P Europe and Canadian dividend aristocrat’s lists. To quote from the company's website:

The International Dividend Achievers™ Index is designed to track the performance of dividend paying American Depositary Receipts and foreign common stocks trading on major US exchanges. To become eligible for inclusion in the International Dividend Achievers Index a stock must be incorporated outside the United States, trade on the NYSE, NASDAQ or AMEX, and have increased its annual regular dividend payments for the last five or more consecutive years. In addition, requires that a stock's average daily cash volume exceed $500,000 per day in Nov. and Dec. prior to reconstitution.

The international dividend achievers index has closely tracked its benchmark over the past 10 years. It performed better than the benchmark in only 3 of the past 10 years however.















According to Mergents Inc, a $10,000 investment in the International Dividend Achievers Index ten years ago would be worth about $19,279 by the end of July 2008.
















There's an ETF that tracks the index. The Ticker is PID.

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