Back in September, a group of dividend bloggers launched The Dividend Growth Index. This is a dividend portfolio of 24 stocks (US and CDN). Each quarter, we follow our picks and the overall portfolio results. By following our blogs, it allows you to track closely 24 great dividend stocks and how they perform over time.
This is now our 2nd Quarter and we are already seeing some changes. Unfortunately, one of our participants, Wealthy Canadian, had to quit blogging for personal reasons. We are currently holding on his stock picks in our index but we will eventually find another bloggers to take over his picks and make modifications accordingly.
Before we disclose the index results, let’s take a look at my own picks… they have done pretty well J.
Intel – INTC
INTC continues his great ascension since August 2011 (click here for INTC analysis). INTC has recently multiplied the efforts and partnerships in order to gain market shares in the mobile & tablet industry. They concluded strategic alliances with Technicolor & Samsung around M-Go (a free app combining all media), another multi-year partnership with Motorola including chips for smartphones and a partnership with Visa to advance mobile commerce. All INTC shareholders wish they can do a partnership with Apple as well which is dominating both the smartphone and table industry. Both companies have worked together in the past, so it’s not impossible.
The stock has risen sharply for the past 6 months but I think there is still room for growth. I’m definitely keeping INTC in this index!
Coca-Cola – KO
Last year, I’ve preferred KO to Pepsi (PEP) (read why here). I can say that I was right… for now anyway! Hahaha! KO has benefited from the bull market on US stocks while trailing behind the index. Between you and me, I didn’t pick KO to beat the S&P Index; I picked KO because I know it was a solid value for several years! In February, they announced another dividend increase by 8.5%. This is definitely why I’ve picked this stock! With a strong balance sheet, KO is looking for acquisition in other countries. I’m definitely keeping KO in my index for now.
National Bank – NA
One of my favorite stocks, NA, hasn’t disappointed me. While the Canadian market is near +5% in 2012, NA is surging by more than 10% + dividend! In 2011, they have done some great acquisition in the brokerage industry. Early in 2012, they continue their plan but with a sale this time. National Bank sold 65% of their shares in Natcan, their fund management division, to Fiera Capital. The goal behind this transaction was to become more competitive and provide better mutual funds. By becoming a bigger player in the mutual fund industry, they hope to improve their investment services to their clients. In addition to that, we should be seeing the first implantation of their multi-million dollar techno projects; MAX. The purpose of MAX is to update significantly all informatics platforms across the company. This ambitious project started 3 years ago and we should see the first applications toward the end of 2012. National Bank had a technological weakness compared to its competitors. This should be resolved with MAX. National Bank is giving me all the reasons in the world to keep it in the index.
Dividend Growth Index Update:
It’s easy for us to say that we did well because we started the Dividend Growth Index in a bullish Quarter. After 2 quarters, our portfolio shows a return of 20.74% or $28,977 (assuming we invested $1,000 in each 24 stocks as at September 30th 2010). But an index is nothing without a strong comparison. This is why I have decided to compare our results to 2 groups of ETFs. For each group, I’m using a 40%/60% combination of CDN ETF / US ETF to compare apples to apples with our index (which is 37.5% CDN and 62.52% US).
The first group is the biggest Dividend ETF on both sides of the borders: XDV (on the Canadian side) and VIG (on the US side). The results in dollar would be $28,009. Therefore, our Dividend Growth Index beat the combination of the 2 biggest dividend ETF on the market.
Now, for the second group, I’ve tried the comparison with the 2 biggest stock market index ETF: XIU (CDN) and SPY (US). The combination of both ETFs for the last 2 quarters would have given a portfolio at $28,458.
The Dividend Growth Index Beat Both Portfolios!
However, I must admit that we have been somewhat lucky with FTS that made 81.44% on the Canadian market. So we will see if we can continue to outperform the market over the long run. On the other side, none of our picks is negative at the moment which is quite an achievement! You can see the result here (and you can get update on other stocks at the bottom of this post):
Blogger Stock #Shares 30-sept Value #Shares-31March New Price Value Return Local
My Own Advisor ABT US Equity 19,55 51,14 $999,79 19,90020182 61,29 $1 219,68 21,99% US
BNS CN Equity 18,97 52,72 $1 000,10 19,35443968 55,88 $1 081,53 8,14% CN
CLC CN Equity 106,38 9,4 $999,97 110,4050008 10,6 $1 170,29 17,03% CN
The Dividend Guy Blog INTC US Equity 46,87 21,335 $999,97 47,64800631 28,115 $1 339,62 33,97% US
KO US Equity 14,8 67,56 $999,89 15,01329918 74,01 $1 111,13 11,13% US
NA CN Equity 14,31 69,89 $1 000,13 14,59435851 79,37 $1 158,35 15,82% CN
The Dividend Monk ETE US Equity 28,75 34,78 $999,93 29,67412326 40,3 $1 195,87 19,60% US
NVS US Equity 17,93 55,77 $999,96 19,25885492 55,41 $1 067,13 6,72% US
WMT US Equity 19,27 51,9 $1 000,11 19,51916555 61,2 $1 194,57 19,44% US
Dividend Ninja HSE CN Equity 44,07 22,69 $999,95 45,14237384 25,38 $1 145,71 14,58% CN
PEP US Equity 16,16 01-mars $1 000,30 16,42332904 66,35 $1 089,69 8,94% US
SPLS US Equity 75,19 13,3 $1 000,03 76,225364 16,19 $1 234,09 23,41% US
Passive Income Earner CNR CN Equity 14,28 70,03 $1 000,03 14,41051831 79,27 $1 142,32 14,23% CN
CNQ CN Equity 32,5 30,77 $1 000,03 32,68317693 33,06 $1 080,51 8,05% CN
AFL US Equity 28,61 34,95 $999,92 29,01754557 45,99 $1 334,52 33,46% US
Wealthy Canadian RY CN Equity 20,81 48,06 $1 000,13 21,25498175 57,81 $1 228,75 22,86% CN
FTS CN Equity 188.68*** 5.3*** $1 000,00 56,22578932 32,27 $1 814,41 81,44% CN
BIN CN Equity 46,36 21,57 $999,99 46,95774636 21,67 $1 017,57 1,76% CN
Dividend Mantra COP US Equity 15,79 63,32 $999,82 16,09005061 76,01 $1 223,00 22,32% US
PM US Equity 16,03 62,38 $999,95 16,33337459 88,61 $1 447,30 44,74% US
PG US Equity 15,83 63,18 $1 000,14 16,08483673 67,21 $1 081,06 8,09% US
DividendGrowth Investor CVX US Equity 10,8 92,59 $999,97 10,97055312 107,21 $1 176,15 17,62% US
MCD US Equity 11,39 87,82 $1 000,27 11,5558135 98,1 $1 133,63 13,33% US
EPD US Equity 24,91 40,15 $1 000,14 25,57516123 50,47 $1 290,78 29,06% US
$24 000,52 $28 977,68 20,74%
Dividend Growth Index Participants (click on their name to get their stock pick update)
Disclaimer: I own shares of INTC, KO and NA.