Friday, January 02, 2009

S & P 500: Payers Versus Non Payers Performance As Of December 2008

For the month of December and the entire 2008 calendar year, the dividend paying stocks in the S&P 500 Index outperformed the non-payers on an average return basis. In the month of December the payers returned 4.41% versus the non payers return of 3.88%. For the 12-months of 2008, as the below table notes, both payers and non-payers underperformed the market cap weighted total return of the S&P 500 Index.


Given the magnitude of the market's decline, even outperformance to the index seems little consolation in the market environment experienced in 2008.


4 comments :

JEFF PARTLOW: THE COVERED CALLS ADVISOR said...

David,
Please re-check your numbers. How can the average for the non-payers and the payers both be below the average for the total S&P?
Jeff

David Templeton, CFA said...

CCA,

The return for the payers and non-payers is calculated using the "average" return. The Index return overall is the "market cap" weighted return; thus accounting for the difference.

Hope this helps.

David

JEFF PARTLOW: THE COVERED CALLS ADVISOR said...

David,
Can you compare using the same method? Either calculate all 3 based on averages or calculate all 3 using market cap weighted. Otherwise, you're comparing apples and oranges in your chart.
Jeff

David Templeton, CFA said...

Jeff,

I agree this is not comparing apples to apples. I actually pull the information from Standard & Poor's website and they do not calculate the S&P return on an average basis for the data series in this post. I can probably obtain the average S&P return somewhere else. I will look and see what I can find.

Thanks,
David