Investment approach

In a world (almost) without interest rates, high-dividend shares represent a source of steady income. Nevertheless, the importance of dividend payments is underestimated. In the long term, dividends provide the highest contribution to the overall performance of an equity investment, because reinvested dividends generate a considerable compound interest effect. Therefore, shares with high yields are preferred in DJE - Dividende & Substanz. However, it is not the highest dividend yield that is decisive here, but above all a sustained and ideally rising dividend payment. A low payout ratio helps here. Empirical analyses have shown that high-dividend stocks can be a more stable form of investment in difficult market phases than low-dividend stocks, since a dividend can act as a buffer to cushion temporary price losses. The calculation is simple and obvious: good substance, excellent balance sheet quality as well as a high dividend yield with an earnings situation that is as secure as possible increase the chance of achieving sustained investment success.

Monthly Commentary

In June most stock markets performed well. Although rising global inflation weighed on the markets, especially as investors now expect central banks to raise key interest rates sooner than 2023, the markets benefited from high expected corporate earnings growth in the second quarter and further improvements of economic indicators. In the USA and Europe business confidence and consumer confidence improved and purchasing managers' indices for the industrial and service sector rose or maintained their high level. In this market environment the price of DJE - Dividende & Substanz rose 3.06%. Its benchmark index, the MSCI World in euro terms, recorded a gain in height of 4.54%. In June a good two-thirds of the sectors of the global stock market performed positively. The technology sector recorded the highest price gains, followed by the sectors healthcare, energy and retail. The sectors real estate and automotive also delivered encouraging results. On the other hand, the sectors insurance, basic materials, credit institutions and travel & leisure suffered price losses. During the reporting period the fund benefited from the sectors healthcare, consumer cyclicals and information technology. In addition, positive momentum also came from the sectros telecommunications, financial services and real estate. The best individual stock results were delivered by the US online payment service PayPal, the Danish pharmaceutical company Novo Nordisk and the US online mail order company Amazon. On the other hand, the utilities and basic materials sector were the main detractors from fund performance in June. The weakest stock results came from the mining groups Anglo American (UK), Newmont Mining (USA) and Antofagasta (UK). During the month the fund management increased the sectors technology, industry, financials and healthcare. Reduced were the sectors insurance and chemicals. Regionally the fund management increased the allocations of the U.S. and Switzerland and reduced the one of Germany. The fund's equity allocation remained almost stable at 99.54% (99.73% previous month). Accordingly, the cash ratio was 0.46%, down from 0.27% previous month.

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