NEW YORK, JUNE 1, 2021 – S&P Dow Jones Indices ("S&P DJI"), the world's leading index provider, announced today the launch of the S&P Dividend Growers Index Series, which includes the S&P U.S. Dividend Growers Index and the S&P Global Ex-U.S. Dividend Growers Index, adding to its family of widely-tracked dividend-based benchmarks.
These two indices have been selected by and licensed to Vanguard to serve as target benchmarks for two of the asset manager's dividend-focused index funds. The U.S. index will also be used as a performance benchmark for one of the asset manager's actively managed mutual funds.
"S&P Dow Jones Indices has been a pioneer in developing innovative, independent and transparent indices that measure and capture important potential signals of companies' well-being through long-term and consistent dividend payments," said Dan Draper, Chief Executive Officer at S&P Dow Jones Indices.
"We're very pleased that Vanguard has selected our indices to serve as target benchmarks for two of their popular dividend-themed index funds and the performance benchmark for an actively managed mutual fund. S&P DJI is pleased to license our indices to clients such as Vanguard so that they in turn can offer accessible and cost-efficient products to help end investors save for retirement and meet their investment goals," Mr. Draper added.
The S&P Dividend Growers Index Series is anchored on rules-based and publicly available methodologies. The S&P U.S. Dividend Growers Index and the S&P Global Ex-U.S. Dividend Growers Index respectively utilize the S&P United States BMI and the S&P Global Ex-U.S. BMI as the starting
universe for stock selection.
The two indices measure the performance of companies that have followed a policy of consistently increasing dividends every year for a specified number of years. The indices are subject to an indicated annual dividend yield exclusion, omitting the top 25% highest ranked eligible companies from the index universe. To reduce excessive turnover, existing constituents are removed from the index if they are in the top 15% by dividend yield.
Constituents are float-adjusted market capitalization (FMC) weighted, subject to a single constituent weight cap of 4%. The index series attempts to ensure high capacity and tradability by rebalancing over a period of three days compared to the standard single day rebalance in most equity indices.
