STOXX Ltd., the European index provider, has launched the first dividend index for the Nordic region. The Dow Jones STOXX NORDIC Select Dividend 20 Index further complements the widely successful Dow Jones and Dow Jones STOXX Select Dividend index family.
The Dow Jones STOXX NORDIC Select Dividend 20 Index includes the 20 highest yielding stocks of Denmark, Finland, Norway and Sweden and has an annualised performance of 13.9 percent since its inception on 31 December 1998. The Dow Jones STOXX NORDIC Select Dividend 20 Index has outperformed the Dow Jones STOXX NORDIC Total Market Index by 101.3 percent over the same time period.
“The Dow Jones STOXX NORDIC Select Dividend 20 Index follows the unique and widely successful concept of our select dividend index series. The components are weighted according to their dividend yield, not by their market capitalisation,” says Lars Hamich, the managing director of STOXX Ltd. “The new Dow Jones STOXX NORDIC Select Dividend 20 Index allows investors to further diversify their portfolios with returns from leading dividend-paying companies domiciled in Denmark, Finland, Norway and Sweden.”
To be eligible for inclusion in the Dow Jones STOXX NORDIC Select Dividend 20 Index, a component must have a positive, historical, five-year dividend-per-share growth rate and a dividend-to-earnings-per-share ratio of less than or equal to 80 percent in the current year, or be a previous component.
Each company’s weight in the Dow Jones STOXX NORDIC Select Dividend 20 Index is based on its indicated annual dividend yield. The indicated annual dividend yields for all components are totaled, and each component’s weight is equal to its dividend yield contribution. The weight of individual components in the Dow Jones STOXX NORDIC Select Dividend 20 Index is restricted to 15 percent. This restriction is implemented quarterly.
The Dow Jones STOXX NORDIC Select Dividend 20 Index is reviewed on an annual basis in March. Price and total return indexes are calculated in Euro and U.S dollar and Swedish Krona.