High Dividend Yield and Hedged Indexes HERO IMAGE
High Dividend Yield and Hedged Indexes
MSCI High Dividend Yield
The MSCI High Dividend Yield Indexes aim to reflect the opportunity set of companies with high dividend income and quality characteristics that pass dividend sustainability, persistence and quality screens. These measures aim to omit securities with potentially deteriorating fundamentals that could force them to cut or reduce dividends. The MSCI HDY Indexes are also available on a hedged version.
The MSCI High Dividend Yield Index employs the following:
- Dividend sustainability screens to exclude both securities whose dividend payout is extremely high or negative, and therefore, where future dividend payments might be in jeopardy, as well as securities with high dividend yield resulting from a plunging stock price without fundamental support
- Dividend persistence screens to exclude securities without a good historical track record of consistent dividend payment
- Quality screens to exclude firms with low valuation and weak balance sheets that could fall into a “value trap”.