These dividend stocks beat the Dow and S&P 500 through thick and thin

Before the painful fourth-quarter stock market decline, steady dividend payers probably weren’t foremost in many investors’ minds. After all, the Federal Reserve was raising interest rates and the massive cut in federal corporate income taxes was setting up even better earnings and sales comparisons than usual. But the current lower valuations (and higher yields) for “Dividend Aristocrats,” as well as their better short-term and long-term performance, might inspire you to take a second look.

S&P Dow Jones Indices maintains the S&P 500 Dividend Aristocrats Index SPDAUDP, +0.30% which is made up of the 53 companies in the S&P 500 Index SPX, +0.98% that have raised their regular dividends on common shares for at least 25 consecutive years. It makes do difference how high a Dividend Aristocrat’s current dividend yield is. The idea is that a commitment among corporate management teams to increasing their payout to investors each year can lead to better performance over the long haul. One easy way to invest in the Dividend Aristocrats as a group is the ProShares S&P 500 Dividend Aristocrats ETF NOBL, +0.49% The ETF holds all 53 Dividend Aristocrats and has an annual expense ratio of 0.35%, with a five-star rating (the highest) from Morningstar.

Source: Market Watch

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