Can you link me to a fund or ETF that has been successful at beating the market? Every time I research this, I come up short. When people talk about this, the Dividend Aristocrats commonly come up. A list of companies which have increased their dividend every year, for the pat 25 years. How could we go wrong? They throw up a chart showing the Dividend Aristocrats handily beating the market, and proclaim victory for their strategy. It's all Survivorship Bias.
http://www.bogleheads.org/wiki/Survivorship_bias
The charts simply show, "This group of stocks which have exhibited increasing returns every year for the past 25 years, have higher returns than the market as a whole."
That sounds like a reasonable statement to make. How is that information actionable? Shall I then invest money in the stocks which have performed well over the past 25 years, hoping they will continue to perform well in the next 25 years? Alarm bells should start ringing on that one.
While these charts on past performance always look great, I have yet to see an actual real-time dividend-focused fund beat the market. This seemed strange to me, if the charts look so great, why weren't any funds/ETFs able to capitalize on this?
I don't know what the OP is trying to accomplish, but I do hate to see a good dividend strategy maligned.
Since inception, SDY has beaten the S&P 500 with a lower standard deviation to boot. Sounds pretty decent to me.
If you'll see the chart I posted a few posts up, you'll see a $10,000 investment made in SDY at inception would have grown to $21,253 as of today, while that same investment in Vanguard's S&P500 fund would have grown to $21,021. They've gone back and forth a few times, and have always been very close. If you consider that a decent strategy, then I'd recommend just buying the total stock market index VTSAX, which beat them both.
