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2020 has been a brutal year for dividends in general, thanks to the economic slowdowns put in place to fight the COVID-19 virus. According to the research I did for this article: https://www.fool.com/investing/2020/09/28/how-we-beat-the-co... , global dividend income may very well drop somewhere in the neighborhood of 20% this year. That provides a good reason to take a look at the dividends and dividend-like(*) income received by the former iPIG portfolio to see whether its selection criteria helped its dividends hold up better than the market's as a whole.

As it turns out, the account's dividends have well outperformed the market's dividend meltdown trends, and it looks like it may very well remain on track for the portfolio's originally stated goal of dividend income increasing at least in line with inflation. The table below shows the quarterly breakout through 9/30.

Note that while no money has been added to or removed from the former iPIG portfolio since its inception, dividends within the portfolio have been collected as cash and can be used to reinvest. That means a portion of the year over year change can likely be attributed to reinvesting portfolio cash flow into dividend paying stocks instead of from pure dividend growth.

Quarter 2019 2020 Y/Y %Change
JFM $ 556.20 $ 628.13 +12.9%
AMJ $ 550.39 $ 623.34 +13.3%
JAS $ 583.90 $ 623.66 + 6.8%
Through 9/30 $1,690.49 $1,875.13 +10.9%


Based on the quarterly profile of dividend payments, it appears the former iPIG portfolio's dividends held up well in the AMJ quarter -- the first full quarter of COVID-19's US impact. From the look of the JAS quarter, it looks like dividend increases were somewhat muted vs. 2019, or quite possibly, increases in some companies' dividends were offset by cuts in others'. As you can probably tell from my lack of recent investment updates on this board, I haven't been paying as close attention to this account as I probably should have been. Still, the companies in the account have largely seen their dividends hold up remarkably well (a testament to their businesses and balance sheets, not to anything I was doing).

If a treatment, a vaccine, herd immunity, or fortuitous viral evolution enables us to get back to some semblance of normal in the not too distant future, there's a good chance their businesses can also find a path back to growth. Of course, on the flip side, the longer things stay restricted, the tougher it is to justify maintaining a dividend in the face of crazy uncertainty, so only time will tell what the future really does bring.

Regards,
-Chuck
Discovery/HR Home Fool

(*)Dividend-like income includes non-dividend income paid as part of a company's quarterly distribution. From a practical perspective, it generally looks a lot like a dividend until the company reports its financials and breaks out what portion is dividend vs. other payments, often around tax time.
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