1Mês·

Question about the benchmark

If I compare a share (e.g. $MBG (-0,19%) , example chosen because of relatively high returns (6-8% p.a.) at an "almost" constant price) against an index (or an index etf e.g $VUSA (-0,88%) ) benchmark. How is the dividend offset against the benchmark, or is it not taken into account? I assume this is not a comparison with a direct reinvest, is it?

4 Comentários

Christian@Investor-College

1Mês

You can do it, why not? However, few tools are capable of making a comparison including dividends.
mornigstar.com, for example, can.
https://www.morningstar.com/stocks/xetr/mbg/chart
Add the comparison value $VUSA (compare) and activate "Growth with Dividend" in the Data tab.
You can then compare the total return (price performance + dividend) of the two stocks over any period of time.
You can even switch between USD and EUR.

Hope it helps!
@yuekseltoprak I would also rather benchmark my overall portfolio against an ETF, but: because it works ;-)

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Yüksel T.@yuekseltoprak

1Mês

@DonaldTruck This question shows a fundamental misunderstanding when comparing performance.

The problem is that benchmarking an individual share against a diversified index is methodologically flawed. You are comparing apples with oranges - different risk structures, different degrees of diversification.

Correct approach:

- Benchmark $MMBG against relevant sector peers or a sector ETF
- Use risk-adjusted metrics (Sharpe ratio, alpha)
- For dividend stocks: Always compare total returns (dividends reinvested)

On the dividend question: Professional benchmarks already use total return indices. A "dividend deduction" would systematically underestimate the index performance.

Bottom line: If you want to evaluate $MMBG, compare it with other German dividend aristocrats or the corresponding sector - not with a broadly diversified index.

@Investor-College has the right approach with Morningstar - you can also find sector-specific comparisons there.

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DonaldTruck@DonaldTruck

1Mês

@yuekseltoprak thanks for the time of your message, then put it against a BMW or VW. The original question remains whether and how dividends are calculated here.

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Yüksel T.@yuekseltoprak

1Mês

Yes, but I would not compare an ETF with an individual share. Greetings!

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