DAC Insights: Growth Of Capital And Growth Of Income
Dividend Assets Capital (DAC) has a rich 40-year history built upon a proprietary dividend growth investment philosophy known as 3D – Double Digits for a Decade or MoreTM. At its core, this discipline seeks to identify companies that have demonstrated the ability and commitment to increase their dividends at double-digit rates for ten years or longer. We believe these businesses often possess the fundamental characteristics necessary to drive long-term value, and tend to perform exceptionally well, for reasons that extend beyond their dividends alone.
Over four decades, DAC has perfected the process of combining these high-quality dividend growth companies into portfolios designed to deliver two significant benefits to investors: long-term capital appreciation AND a steadily growing stream of portfolio income. While most discussions about portfolio results focus on total return, we believe that the growth of portfolio income is an equally important outcome that is often overlooked by most investors.
The DAC Equity strategy provides a compelling example of how a single investment approach can achieve both objectives. As illustrated in the mountain chart below, a hypothetical $500,000 investment in the representative DAC Equity portfolio as of June 30, 2016, grew to $1,509,613 ($1,437,709 net of DAC’s management fee) over a 10 year period. At the same time, the portfolio’s annual income increased from $10,600 to $26,424, as shown in the accompanying bar chart, representing an average annual cash flow growth rate of 13.1%.
The information contained herein has been compiled from sources that Dividend Assets Capital, LLC (“DAC”) believes to be reliable, but no warranty, expressed or implied, is being made that the information is complete or accurate. DAC makes no guarantee that the objectives associated with a particular strategy will be achieved, will equal past performance, or will be profitable. Different types of securities and/or strategies involve varying degrees of risk and have the potential for profit or loss.
Historical performance results assume reinvestment of portfolio income and generally do not reflect the deduction of transaction and/or custodial charges. The “Pure Gross of Fees” performance results shown in this hypothetical illustration are calculated gross of all fees. The “Net of Fees” value reflects the deduction of DAC’s investment management fee charged to the “Representative Portfolio” for the DAC Equity strategy composite (at 0.45%, or 45 basis points annually). The inclusion of transaction, custodial, and/or advisory fees, as well as other expenses, will reduce actual returns.
Dividend Assets Capital, LLC is a Registered Investment Adviser with the U.S. Securities and Exchange Commission. Registration does not imply any certain level of skill or training. You should carefully consider the investment objectives, potential risks, management fees, and charges and expenses before making an investment. The Firm’s Investment Adviser Brochure, Form ADV Part 2, contains this and other information about the Firm and should be read carefully before investing. You may obtain a current copy of DAC’s Form ADV Part 2 by visiting our website at https://dacapitalsc.com/, emailing nfo@DACapitalSC.com, or by calling us at (866) 348-4769. Additional information about Dividend Assets Capital, LLC is also available on the United States Securities and Exchange Commission’s website at www.adviserinfo.sec.gov. You may search this site using a unique identifying number known as a CRD. DAC’s CRD is 129973.
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Dividend Assts Capital, LLC is an independent, employee-owned wealth advisor specializing in high quality companies with a history of consistently increasing dividends. Built on a pioneering legacy, our goal is straightforward; achieve our clients desired outcomes through investments that provide sustainable and rising income with long-term capital appreciation. We partner with successful families, advisors and institutions delivering tailored services that adhere to fiduciary principles to provide…
Clarity: A transparent and understandable approach to portfolio management.
Simplicity: We believe dividends are the best indicator of the future price performance of a stock.
Devotion: We build confidence through a disciplined process and strong devotion to our investment philosophy and clients.