You are absolutely right, thank you for pointing that out. I should have noticed that since I stated it was 2.55% later on (from ProShares site). I'm going to go ahead and blame that on the intern that works here... errr... used to work here. ;) And thank you for the kind words despite the mistake. Joe P.
Gents. I have a question. Assume the MER of NOBL was less punitive like say 6bps: why is NOBL so underperforming the other dividend growth etfs perennially and why is the yield and dividend growth so weak? Thank you. Javier.
This is where some proper back testing tools could in handy. It's really tough to say without spending a few hours researching it. Even then, the answer would require some industrial-strength software and data.
Hi Joe, another great video as always! I love your work, it never ceases to amaze how much detail and substance you put into these videos. I have a question for you and I know you will probably say you cannot give financial advice and don’t like to speculate. But what does your instinct tell you about US growth stocks at the moment? Even if the broader market were to have a major correction sometime this year, do you think growth stocks bottomed last December 2022 with the Nasdaq? There are some very compelling small caps at the moment that are trading at very low P/S ratios and I’m not sure how much they would react if there was a broader market correction? What are your thoughts on this? And again, I know this is not financial advice! Thank you 🙏
I really appreciate you noticing the detail that goes into these videos. Many of these topics I've been researching for a long time, and our team has published a lot of research on, so it makes the job easier. Good question on growth stocks - what everyone wants to know of course. From what we can see, growth stocks were really punished in the bear market that everyone believes has ended, which probably HAS ended based on commonly-accepted definitions. If there was a broad-market correction, testing those lows would be expected. Remember, tech stocks are extremely volatile. Any news can make them move downwards, not just a market correction. So just dollar-cost-average into some of these names slowly and set valuation targets (we use simple valuation ratio, a variation of Price-to-Sales). When you cannot predict the market movements as nobody can then you use objective methods to govern your investment activities which help you sleep well at night. And when you invest in tech companies, it should only be quality names, and even then you need to understand just how risky this space is. If you're properly diversified you'll sleep a lot better. Hope this rant helps! Thank you for the kind words of support. They mean a lot! Joe P.
Hey, Joe. If you have a lump-sum of money to invest in dividend growth companies, should you invest the whole amount immediately or over several quarters in a one-year period?
We would spread it out using DCA but there's also an argument to be made for getting into the market ASAP when money is made available. Since interest rates are high you get pretty good compensation for just holding money so maybe lean towards DCA. Joe P.
Thoughts on shareholder yield? Not as highlighted as dividend aristocrats, but my backtests showed slightly better performance. Yes, backtests are not perfect, but I do find shy to be a compelling alternative. Have you guys done a video on ratios yet? I know you talk about some ratios you look at, but surely there are others. Some have been pretty good indicators, like z score, f score. Regardless of actual performance, I don't think anyone would argue that ratios shouldn't hold some weight when screening at least.
Shareholder yield as in the ETF with the same name? You mention SHY - that's the iShares 1-3 Year Treasury Bond ETF, no? For now we'll be plowing through a few more names to see if we can find "the best" dividend ETF. You mention ratios and other statistical methods of screening. You're a regular so you know we keep things extremely simple. That's not just because we're simple people, it's so that everyone can replicate what we do on their own easily. Regarding our own DGI strategy, we do screen on size. We then rank the leftovers using seven factors to establish what we call "Q scores." It's all rather fun, and of course, quite simple. You can then start to get as sophisticated as you want with the universe, including removing that size screen we have.
@Nanalyze @Nanalyze Sorry for the mistake, I meant perhaps dividend yields are not the only metric to consider. Buybacks and debt paydown, maybe should also be a factor. Everyone loves the dividend aristocrats for their reliability, but I'm not privy to anyone really discussing companies with constant buybacks (or growing shareholder yield). Both show a commitment to shareholders. I am just curious why the dividend options are more largely discussed and preferred. Yes, you guys have a sound strategy. Wouldn't expect any less 😁
@@MrMentalpuppy Really appreciate the feedback and kind words! Buybacks would be beneficial only if shares are priced at a value (Buffett talks about this quite well) and debt can be beneficial to hold for any number of reasons. You are right about exploring the financial stability. In our opinion, maintaining a track record is pretty good proof that the company is financially disciplined.
Another great video. How you think about the tradeoff between current yields and dividend growth? It seems to be a tradeoff between those two for most stocks. Is there an optimal combination that you target?
Great question! What you'll often find is that the two are somewhat correlated. So COMPANY A might have a yield of 1.3% that's growing 15% a year while COMPANY B might have a yield of 5% that's growing 3% a year. That's when it becomes fun to plot them over time and see how long it takes the lower yield stock to catch the higher yield stock :) To pick stocks we use Q-scores which take BOTH into account and they help make those decisions easier and more objective. Very good question.
@@deanmagee4245 A video on that topic could easily be merited. One of THE most common traps that dividend investors fall into is incorrectly interpreting yield. good idea. The short answer to your Q-score question is yes because both have an equal cap. The more accurate answer is that in our Quantigence report we provide every formula used to calculate Q-scores so any investor can do the same in Excel. Where you'll run into problems is in accessing the data which we've licensed from Nasdaq with permissions to use for our strategy.
I wonder if I could outperform this ETF if I bought its holdings directly and updated it once a year or so. My transaction fees would surely be less than 0.35%
If you have the patience to monitor almost 70 different stocks, then feel free! The only real action needed would be rebalancing as you said, and selling when a stock stops increasing its dividend. That's similar to what we do with our Quantigence strategy, actually. Though we refine our list to 30.
Very good question. More than a third of our readers/subscribers hail from Europe so that's very relevant. Answer is that it's a mixed bag. for example the SPDR S&P Euro Dividend Aristocrats UCITS ETF actually tracks the S&P Euro High Yield Dividend Aristocrats index. We haven't looked a that index very closely. Maybe in the future we can do a piece on UCITS dividend ETFs. Note that we're also building a universe of international dividend aristocrats (with lower cutoff - 20 years consecutive instead of 25 perhaps) to be released in early 2024.
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NOBL does not have YIELD of 4.29%, is that a mistake? Current yield is 2.13%
Anyway one of the best review for NOBL I’ve seen in a while on RUclips
You are absolutely right, thank you for pointing that out. I should have noticed that since I stated it was 2.55% later on (from ProShares site). I'm going to go ahead and blame that on the intern that works here... errr... used to work here. ;) And thank you for the kind words despite the mistake. Joe P.
Gents. I have a question. Assume the MER of NOBL was less punitive like say 6bps: why is NOBL so underperforming the other dividend growth etfs perennially and why is the yield and dividend growth so weak? Thank you. Javier.
This is where some proper back testing tools could in handy. It's really tough to say without spending a few hours researching it. Even then, the answer would require some industrial-strength software and data.
Hi Joe, another great video as always! I love your work, it never ceases to amaze how much detail and substance you put into these videos. I have a question for you and I know you will probably say you cannot give financial advice and don’t like to speculate. But what does your instinct tell you about US growth stocks at the moment? Even if the broader market were to have a major correction sometime this year, do you think growth stocks bottomed last December 2022 with the Nasdaq? There are some very compelling small caps at the moment that are trading at very low P/S ratios and I’m not sure how much they would react if there was a broader market correction? What are your thoughts on this? And again, I know this is not financial advice! Thank you 🙏
I really appreciate you noticing the detail that goes into these videos. Many of these topics I've been researching for a long time, and our team has published a lot of research on, so it makes the job easier. Good question on growth stocks - what everyone wants to know of course. From what we can see, growth stocks were really punished in the bear market that everyone believes has ended, which probably HAS ended based on commonly-accepted definitions. If there was a broad-market correction, testing those lows would be expected. Remember, tech stocks are extremely volatile. Any news can make them move downwards, not just a market correction. So just dollar-cost-average into some of these names slowly and set valuation targets (we use simple valuation ratio, a variation of Price-to-Sales). When you cannot predict the market movements as nobody can then you use objective methods to govern your investment activities which help you sleep well at night. And when you invest in tech companies, it should only be quality names, and even then you need to understand just how risky this space is. If you're properly diversified you'll sleep a lot better. Hope this rant helps! Thank you for the kind words of support. They mean a lot! Joe P.
Always learning because of your content! Thanks again!
That's exactly what we want to hear. Thank you for taking the time to let us know!
Hey, Joe. If you have a lump-sum of money to invest in dividend growth companies, should you invest the whole amount immediately or over several quarters in a one-year period?
We would spread it out using DCA but there's also an argument to be made for getting into the market ASAP when money is made available. Since interest rates are high you get pretty good compensation for just holding money so maybe lean towards DCA. Joe P.
@@Nanalyze Thanks, Joe!
Thoughts on shareholder yield? Not as highlighted as dividend aristocrats, but my backtests showed slightly better performance. Yes, backtests are not perfect, but I do find shy to be a compelling alternative. Have you guys done a video on ratios yet? I know you talk about some ratios you look at, but surely there are others. Some have been pretty good indicators, like z score, f score. Regardless of actual performance, I don't think anyone would argue that ratios shouldn't hold some weight when screening at least.
Shareholder yield as in the ETF with the same name? You mention SHY - that's the iShares 1-3 Year Treasury Bond ETF, no? For now we'll be plowing through a few more names to see if we can find "the best" dividend ETF. You mention ratios and other statistical methods of screening. You're a regular so you know we keep things extremely simple. That's not just because we're simple people, it's so that everyone can replicate what we do on their own easily. Regarding our own DGI strategy, we do screen on size. We then rank the leftovers using seven factors to establish what we call "Q scores." It's all rather fun, and of course, quite simple. You can then start to get as sophisticated as you want with the universe, including removing that size screen we have.
@Nanalyze @Nanalyze Sorry for the mistake, I meant perhaps dividend yields are not the only metric to consider. Buybacks and debt paydown, maybe should also be a factor. Everyone loves the dividend aristocrats for their reliability, but I'm not privy to anyone really discussing companies with constant buybacks (or growing shareholder yield). Both show a commitment to shareholders. I am just curious why the dividend options are more largely discussed and preferred.
Yes, you guys have a sound strategy. Wouldn't expect any less 😁
@@MrMentalpuppy Really appreciate the feedback and kind words! Buybacks would be beneficial only if shares are priced at a value (Buffett talks about this quite well) and debt can be beneficial to hold for any number of reasons. You are right about exploring the financial stability. In our opinion, maintaining a track record is pretty good proof that the company is financially disciplined.
Another great video.
How you think about the tradeoff between current yields and dividend growth? It seems to be a tradeoff between those two for most stocks. Is there an optimal combination that you target?
Great question! What you'll often find is that the two are somewhat correlated. So COMPANY A might have a yield of 1.3% that's growing 15% a year while COMPANY B might have a yield of 5% that's growing 3% a year. That's when it becomes fun to plot them over time and see how long it takes the lower yield stock to catch the higher yield stock :) To pick stocks we use Q-scores which take BOTH into account and they help make those decisions easier and more objective. Very good question.
@@Nanalyze thanks!
It would be great to see you do a video on that. Are those two metrics equally weighted in your Q-score?
@@deanmagee4245 A video on that topic could easily be merited. One of THE most common traps that dividend investors fall into is incorrectly interpreting yield. good idea. The short answer to your Q-score question is yes because both have an equal cap. The more accurate answer is that in our Quantigence report we provide every formula used to calculate Q-scores so any investor can do the same in Excel. Where you'll run into problems is in accessing the data which we've licensed from Nasdaq with permissions to use for our strategy.
I wonder if I could outperform this ETF if I bought its holdings directly and updated it once a year or so. My transaction fees would surely be less than 0.35%
If you have the patience to monitor almost 70 different stocks, then feel free! The only real action needed would be rebalancing as you said, and selling when a stock stops increasing its dividend. That's similar to what we do with our Quantigence strategy, actually. Though we refine our list to 30.
In Europe can I find a ucits etf for this?😮
Very good question. More than a third of our readers/subscribers hail from Europe so that's very relevant. Answer is that it's a mixed bag. for example the SPDR S&P Euro Dividend Aristocrats UCITS ETF actually tracks the S&P Euro High Yield Dividend Aristocrats index. We haven't looked a that index very closely. Maybe in the future we can do a piece on UCITS dividend ETFs. Note that we're also building a universe of international dividend aristocrats (with lower cutoff - 20 years consecutive instead of 25 perhaps) to be released in early 2024.