RISING DIVIDEND PLUS

The Rising Dividend Plus strategy invests in primarily established and seasoned mid- and large-capitalization companies with financial strength that are likely to provide steadily rising earnings and dividends. The portfolio aims to participate in the long-term growth of the economy and the markets by investing in stocks with a high probability of raising dividends in the future. The portfolio targets “value-momentum” stocks with good technical features that we determine have cheap relative and absolute valuation.

Investment Philosophy

Many studies have shown that equities with rising dividends have consistently displayed excess performance relative to the broad market, with reduced volatility. Over time, increases in dividends tend to induce increases in the price of the equity producing those dividends. Companies with strong balance sheet characteristics that consistently raise dividends offer an attractive risk/reward profile and a high probability of outperformance relative to stocks generally in our view. In addition, dividend increases are often seen as signals from management about a company's future prospects.

Investment Objective

The goal of the strategy is to outperform the broad equity market. Safety during market declines is an additional objective, since risk control during declines is a major factor that we believe leads to long-term success. The portfolio may contain overweight positions in certain sectors or industries, changing weights in various capitalization sizes, and as market conditions warrant, downside protection through cash holdings. In other words, the portfolio is also characterized by an element of sector rotation, size rotation, and transitional cash. In this portfolio we make active use of market-driven signals, which are often referred to as “technical” indicators.

Composite Inception Date: December 2004
Portfolio Manager: MHI Investment Team

Performance and portfolio information can be obtained by contacting MHI. If you are an advisor/financial professional, you may log on to our Advisor site to obtain this information.