"Mergent North American Dividend Achievers50™ Index"
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The North American Dividend Achievers 50™ Index is comprised of the 35 US Dividend Achievers and 15 Canadian Dividend Achievers with the highest current yield as of the last trading date in December. Master Limited Partnerships (MLPs), Real Estate Investment Trusts (REITs), and Canadian Income Trusts are excluded from the Index.
These dividend paying companies have a long history of increasing their annual shareholder dividends paid on their common stock.
Each year, they rebalance the fund so that US companies make up 65% of the Index and Canadian companies make up 35% of the Index. The Index is modified yield weighted. That means that no company may total more than 5% of the Index (this is to comply with US governmental regulations).
Currently the top 10 companies in the North American Dividend Achievers 50™ Index are:
- AGF Management Ltd
- Altria Group Inc
- Atmos Energy Corp.
- Bank of America Corp.
- Bank of Montreal
- Bank of Nova Scotia
- BB&T Corp.
- Black Hills Corporation
- Canadian Imperial Bank of Commerce
I like the general idea of this index, but don't quite see why they force a specific allocation of both number of companies and percentage of market value onto it. Why not just include the 50 companies from either the U.S. or Canada that pay the highest dividends? Also, why not include REITs, royalty trusts and Master Limited Partnerships?
If there're fewer U.S companies, tough -- pay higher dividends. If they're fewer Canadian companies, some thing. Pay higher dividends.
North American Dividend Achievers 50™ Notes
The only way to invest directly in this index, at least right now, is to buy notes from First Asset. They offer North American Dividend Achievers 50™ ROC Payment Notes and North American Dividend Achievers 50™ Total Return Notes.
These are backed by a "select" group of companies from the North American Dividend Achievers 50 Index. They offer principal protection at maturity.
The "ROC Payment" series pays a semi-annual coupon. The "Total Return" series reinvests all dividends. The note issuer is The National Bank of Canada. The notes are $100 each, but you must buy a minimum of 20, for $2000.
If you want the really broad diversification of investing in all the companies outside the U.S. which have a long history of raising their annual dividends, check out the Mergent International Dividend Achievers Index.
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