"Hi, Eoin showed a chart with the S&P Dividend Aristocrats outperforming the S&P 500. Just wanted to remind you that the Aristocrats are equally weighted, so you should compare it to an equally-weighted benchmark. If you look at the relative performance versus, say, the S&P Equal Weights, the picture is quite different. As one would suspect, the high-quality dividend growers outperform in bear markets, but in the long term, relative performance is basically flat. (Note that in the chart library, you can only compare the price indices, as there is no total return index for the S&P Equal Weights. The message is the same, though.)"

Eoin Treacy's view Thank you for this insightful email. Equal weighted indices have outperformed impressively over the last decade, particularly against the S&P500 which has mostly gone sideways in a very large range. I added the S&P 500 Equal Weight Total Return Index to the Chart Library.

This ratio comparing the S&P500 500 S&P Dividend Aristocrats Total Return Index to the S&P500 Equal Weight Total Return Index over the last decade bears out your point that reliable dividend payers tend to do best in times of economic stress. The ratio lost downward momentum from late 2009 and rallied to break the progression of lower highs from May. The five-month progression of higher reaction lows would now need to be taken out to question potential for additional Dividend Aristocrat outperformance.

Any comparative chart depends heavily on the start date of the comparison for credibility. This chart originating in Bloomberg comparing the percentage returns of the two indices over the last decade indicates that the Dividend Aristocrats have outperformed the Equal Weight Index by approximately 2.86% per annum which is not inconsiderable.

My main aim in performing these analyses was to demonstrate that there are a select number of shares offering leverage to Fullermoney investment themes, such as rise of the Asian and Latin American middle classes, which pay steady dividends and are capable of outperforming their respective benchmarks in nominal term and on a total return basis.