Miller/Howard Strategic Dividend Index

Overview

About This Index

The Miller/Howard Strategic Dividend Index seeks to capture and distill all we have learned over nearly a quarter century of active management of dividend companies. Our strategic, rules-based index is created to enhance current passive approaches to asset allocation, going beyond market exposure by applying persistent, strategic factors we have observed and confirmed through our active management. We seek to find and retain the "good," as opposed to cap-weighted indexes, which in our view hold the good, the bad, and the ugly—by their very nature and definition.

The Constituents

The Miller/Howard Strategic Dividend Index is a composite of 30 publicly traded equities that provide above-average dividend yields and dividend growth, and are equal weighted based on certain quantitative fundamental factors.

Selection Criteria:

  • Dividend Yield
  • Asset Valuation
  • Profitability
  • Estimated Growth of Yield
  • Momentum

Key Ranking Factors

The index is premised on the assumption that certain observable fundamental factors influence the overall performance and growth of stocks with above-average dividend yields.

Dividend Yield must fall within deciles 7-10 of the investable universe. The 350 lowest yielding stocks from this universe are selected, reducing the impact of the highest yielding stocks on the portfolio.

Asset Valuation. From the resultant 350 stocks, the 300 stocks with the lowest market valuation are selected using the company's stated book value.

Profitability. From the resultant 300 stocks, the 150 most profitable companies are selected based on estimated Return on Invested Capital, adjusted by valuation.

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Sector Weights


As of selection date 9/29/2017

Index Information


Ticker MHDT
Inception Date July 2, 2014
Calculated by Chicago Board Options Exchange
Rebalancing Quarterly

Eligibility Requirements

  • Must be listed on the New York Stock Exchange or NASDAQ.
  • It must have paid quarterly dividends in two previous quarters.
  • No dividend decrease in the past twelve months.
  • It must be a corporation or ADR.
  • MLPs and REITs are excluded.
  • Market capitalization of over $1 billion.
  • Above certain three-month average daily trading volume thresholds.
  • Must have a positive Book Value per Share.

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Performance

Annualized Performance vs. S&P 500 Index (Total Return—as of June 30, 2017)
Performance
Source: Bloomberg.

It is not possible to invest directly in an index. Index performance does not reflect the deduction of any fees and expenses. Past performance is not a guarantee of future returns. Note: Not annualized if less than one year.

Constituents

Miller/Howard Strategic Dividend Index Holdings As of Selection Date 9/29/2017
Company Ticker
American Eagle Outfitters Inc AEO
AES Corp/VA AES
Amgen Inc AMGN
Ameriprise Financial Inc AMP
Aircastle Ltd AYR
Best Buy Co Inc BBY
Brady Corp BRC
Carnival Corp CCL
Cisco Systems Inc CSCO
CVS Health Corp CVS
Discover Financial Services DFS
Darden Restaurants Inc DRI
DSW Inc DSW
Edison International EIX
Eaton Corp PLC ETN
First Hawaiian Inc FHB
GameStop Corp GME
Hormel Foods Corp HRL

Company (continued) Ticker
Hubbell Inc HUBB
James River Group Holdings Ltd JRVR
Kohl's Corp KSS
Lazard Ltd LAZ
Maxim Integrated Products Inc MXIM
Penske Automotive Group Inc PAG
Principal Financial Group Inc PFG
Trinseo SA TSE
US Bancorp USB
VF Corp VFC
Whirlpool Corp WHR
Watsco Inc WSO
Total Members 30
Download Constituents List

The securities identified and described above do not represent all of the securities purchased, sold or recommended for client accounts, or all securities considered as a candidate for inclusion in the Index. The reader should not assume that an investment in the securities identified was or will be profitable.

Past performance does not guarantee future results.


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