๐๐๐ฟ๐๐ด๐ฒ๐๐ถ๐ป๐ป ๐ผ๐ฑ๐ฒ๐ฟ ๐๐ถ๐๐ถ๐ฑ๐ฒ๐ป๐ฑ๐ฒ?
๐๐๐ฟ๐๐ด๐ฒ๐๐ถ๐ป๐ป ๐๐ป๐ฑ ๐๐ถ๐๐ถ๐ฑ๐ฒ๐ป๐ฑ๐ฒ!
...๐ผ๐ฑ๐ฒ๐ฟ: ๐๐ฎ๐ฟ๐๐บ ๐ถ๐ฐ๐ต ๐๐ถ๐๐ถ๐ฑ๐ฒ๐ป๐ฑ๐ฒ๐ป ๐บ๐ฎ๐ด ๐ง๐๐๐ ๐ฎ
another look into the ๐พ๐๐ฉ๐ ๐๐ก๐ค๐๐๐ก ๐๐๐๐ก๐ฉ๐ ๐๐ฃ๐ซ๐๐จ๐ฉ๐ข๐๐ฃ๐ฉ๐จ ๐๐๐๐๐๐๐ 2022.
Why does Citi think dividends are more important today than ever in the current market situation?
๐ Negative real interest rates have increased the importance of dividends in performance-oriented portfolios.
๐ With global dividend yields trading above bonds, Citi believes equities will generate a much larger share of total returns in a diversified portfolio. (actually logical)
๐ Citi recommends companies whose dividends have grown a consistent over time. (should be a criterion mMn anyway when choosing dividend stocks).
๐ These "dividend growth stocks" not only provide yields, but have often outperformed the broader stock market. (see the images for more)
๐ Dividend growth stocks are especially common in healthcare, consumer staples, and semiconductors.
The power of dividend reinvestment is underappreciated. While past performance is not indicative of future performance, Citi sees a potential opportunity to generate further higher returns by investing in a select group of companies that have a long track record of growing their dividends.
By consistently increasing distributions to shareholders over time - even during periods of recessions and expansions - such companies demonstrate their ability to grow profits over time. This, in turn, suggests ๐ฑ๐ฎ๐๐ ๐ฑ๐ถ๐ฒ๐๐ฒ "๐๐ถ๐๐ถ๐ฑ๐ฒ๐ป๐ฑ๐ฒ๐ป๐๐ฎ๐ฐ๐ต๐๐๐๐บ๐๐๐ป๐๐ฒ๐ฟ๐ป๐ฒ๐ต๐บ๐ฒ๐ป" ๐ฝ๐ผ๐๐ฒ๐ป๐๐ถ๐ฒ๐น๐น ๐ต๐ผ๐ฒ๐ต๐ฒ๐ฟ๐ฒ ๐๐ฒ๐๐ฎ๐บ๐๐ฟ๐ฒ๐ป๐ฑ๐ถ๐๐ฒ๐ป ๐ฒ๐ฟ๐๐ถ๐ฒ๐น๐ฒ๐ป ๐ธ๐ผ๐ฒ๐ป๐ป๐ฒ๐ป.
Over the past 30 years, an investment strategy that invests in dividend growth companies has outperformed the S&P 500 Index as well as its Value and Growth Indices - FIGURES 3 and 4. Although there is less historical data for dividend growth companies outside the U.S., Citi believes that ๐ฑ๐ถ๐ฒ๐๐ฒ๐น๐ฏ๐ฒ ๐ฆ๐๐ฟ๐ฎ๐๐ฒ๐ด๐ถ๐ฒ ๐๐ฒ๐น๐๐๐ฒ๐ถ๐ ๐ฒ๐ถ๐ป๐ฒ ๐ข๐๐๐ฝ๐ฒ๐ฟ๐ณ๐ผ๐ฟ๐บ๐ฎ๐ป๐ฐ๐ฒ ๐ฒ๐ฟ๐๐ถ๐ฒ๐น๐ฒ๐ป ๐ธ๐ฎ๐ป๐ป. The reason is that the fundamental factors that form the basis for dividend growth companies cannot be limited to a specific region or location.
Source Photo/Text: https://www.privatebank.citibank.com/outlook
