Dividend Return Vs. Total Return For Developed Market Country Indexes

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 |  Includes: EDEN, EFA, EFNL, EIRL, EIS, ENZL, EPP, EWA, EWC, EWD, EWG, EWH, EWI, EWJ, EWK, EWL, EWN, EWO, EWP, EWQ, EWS, EWU, EZU, GREK, NORW, URTH, VGK, VPL, VTI
by: Richard Shaw

Based on MSCI developed markets country and region indexes, New Zealand, Australia and Spain produced 4% or higher annualized dividend yields over rolling 1, 3, 5 and 10 years as of 2012-04-06.

Spain, in particular, accomplished that by the severe downturn in stock prices. Australia would not have registered a 4+% return for the 1-year period except for a near 10% price drop.

Tiny New Zealand, however, which had dividend yields of high 5% to high 6% range over 1,3, 5 and 10 years, also had generally solid total returns, suffering only a negative 0.4% total return for 5 years. That period, which included 2008, compares favorably with most countries; and they did well for 1, 3 and 10 years.

The United States ranked low in the dividend dimension relative to most of the other MSCI indexes.

On the total return front, the 5-year period is a focus item, because it highlights the decline into 2008 and the subsequent climb back up.

Hong Kong, Singapore, Canada, Pacific-exJapan Israel, Australia, USA, Denmark, and Switzerland managed to register positive 5-year returns. Sweden, New Zealand and the developed markets World index managed to lose less than 1% over 5 years.

However, among those with positive or near-positive 5-year total returns, only New Zealand and the United States generated positive 1-year total returns. The developed markets World index and Switzerland came in not too far behind with negative 1.7% and negative 2.2% 1-year returns.

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This article is for information only, and is not a recommendation for or against any particular investment. It's meant solely to provide a comparative data perspective on developed country stock indexes, and extract the historical dividend yield of country indexes from price and total return figures.

The country or region ETFs listed, may or may not track the MSCI country index, and with tracking error and management fees, the return will differ in any event. Some funds may use sampling (typically for larger markets) and others may use replication (typically for smaller markets).

Some of the identified ETFs are quite new, thinly traded and unsuitable at this time for most investors. Some countries have very minor global stock market significance, and as such represent highly active, non-core decisions if utilized.

Country and region ETFs identified in this post:

Country ETF MSCI Index
EWH HONG KONG
EWS SINGAPORE
EWC CANADA
EPP PACIFIC ex JAPAN
EIS ISRAEL
EWA AUSTRALIA
VTI USA
EDEN DENMARK
EWL SWITZERLAND
EWD SWEDEN
ENZL NEW ZEALAND
URTH WORLD
NORW NORWAY
EWG GERMANY
VPL PACIFIC
EWU UNITED KINGDOM
EFA EAFE
VGK EUROPE
EWN NETHERLANDS
EWJ JAPAN
EWQ FRANCE
EZU EMU
EWP SPAIN
EFNL FINLAND
EWK BELGIUM
EWI ITALY
EWO AUSTRIA
EIRL IRELAND
GREK GREECE
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Disclosure: QVM has no positions in any named security as of the creation date of this article (April 7, 2012).

Disclaimer: This article provides opinions and information, but does not contain recommendations or personal investment advice to any specific person for any particular purpose. Do your own research or obtain suitable personal advice. You are responsible for your own investment decisions. This article is presented subject to our full disclaimer found on the QVM site available here.