Author Topic: VTSAX dividend seems low  (Read 1279 times)

Exflyboy

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VTSAX dividend seems low
« on: June 18, 2019, 03:59:22 PM »
2nd quarter div is $0.2647 per share. It hasn't been that low since Jul 2016... Anybody know why?

1st quarter div was on the high side at $0.3736 which is the highest its been since 2014 (as far back as my chart goes).

If you average the last 2 readings its 0.3192.. which still respectable.


bpage12

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Re: VTSAX dividend seems low
« Reply #1 on: June 18, 2019, 04:09:15 PM »
I am glad you posted this. I didnít think their dividend payout date was until later this week. Disappointed that the dividend was lower this quarter as well. I received $40 less this quarter. I didnít know it would move that much!

dandarc

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Re: VTSAX dividend seems low
« Reply #2 on: June 18, 2019, 04:13:09 PM »
If I had to venture a guess, I'd say the timing being rather early combined with the 1st quarter payment being a bit on the late side meant that fewer of the underlying companies have paid dividends since the first quarter one was paid out.

Dividends just flow through - the amount is whatever it is because that's what the stocks paid.

Exflyboy

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Re: VTSAX dividend seems low
« Reply #3 on: June 18, 2019, 04:19:25 PM »
If I had to venture a guess, I'd say the timing being rather early combined with the 1st quarter payment being a bit on the late side meant that fewer of the underlying companies have paid dividends since the first quarter one was paid out.

Dividends just flow through - the amount is whatever it is because that's what the stocks paid.

Yeah its definitely early.. I wasn't expecting it till around the 23rd. As you say if the payment missed the cutoff of the companies paying that would certainly cause cause a spike/dip.

secondcor521

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Re: VTSAX dividend seems low
« Reply #4 on: June 18, 2019, 04:24:17 PM »
I'm not certain, but a quick google shows that the dividend rate of the S&P 500 varies quite a bit month to month.  It's my belief that VTSAX chooses to pay out all of it's accumulated dividends in a pass through manner.  I don't know when VTSAX quarter ends are, and I don't know if there's any sort of lag between quarter end dates and dividend payment dates.

Based on all that, I'd guess that VTSAX is paying out a lower dividend because the stocks it owns are paying out lower dividends.  Why companies are lowering their dividends I have no idea.  Maybe as a buffer against economic uncertainty, maybe a reaction to  the new corporate tax rates which means that investing in the company's growth makes more financial sense, or maybe something else entirely.

(Yes, I know the S&P 500 isn't equivalent to VTSAX, but it covers about 80% of the capitalization, so it's a good rough approximation and it's easier to get data on S&P 500 metrics.)

dandarc

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Re: VTSAX dividend seems low
« Reply #5 on: June 18, 2019, 04:51:25 PM »
To my earlier point - VTSAX's 2nd quarter was only 84 days long - a full week less than 1/4 of the year.

An example for thought - Microsoft is the fund's #1 holding - their last dividend was paid on 6/13. That happens to be the declaration date of the June dividend for VTSAX - will this money from MSFT be included in the June or September dividend from VTSAX? I'm not sure - would depend on the exact policy Vanguard has for timing, but had that pay date been this week instead of end of last, clearly it wouldn't have been included in the dividend from VTSAX.  A  prudently run fund is not going to pay out money for a dividend before it has received that money from the underlying investment.

With over 3,000 stocks owned, it seems likely that at least a few companies are paying a dividend just about every day, so having a short or long quarter will affect the amount of dividend VTSAX pays.