20 years DWS Top Dividende

DWS Top Dividende celebrates its 20th birthday on April 28. The globally invested equity fund, which offers investors the chance of price gains and regular distributions without exposing them to the full extent of stock market risk, is still a popular basic investment two decades after its launch when it comes to long-term capital preservation and capital accumulation. A look at the fund's assets shows: Thomas Schuessler, who has been pulling the strings at DWS Top Dividende since 2005, is now responsible for about 20 billion euros^[1]. This makes DWS's dividend flagship not only the largest actively managed equity fund in Germany, but also one of the heaviest-weight funds in Europe^[2].

Steering confidently through different stock market phases

A look at the fund's history shows that it fluctuated less than the market-wide MSCI World Index, especially in difficult phases such as the financial crisis, the euro crisis or the Corona crisis^[3]. The business and investor magazine Euro, which awarded Schuessler the "Fund Manager of the Year" award coveted in the fund industry in the spring, put it as follows: Schuessler has steered the DWS Top Dividende since September 2005 confidently through different stock market phases and has stuck to his cautious investment style even when a more offensive orientation would have promised higher gains^[4]. Schuessler also sees his long-term and always conservative approach confirmed: "We want to spare our investors as much as possible a wild roller coaster ride in terms of share price performance, even in volatile markets, and thus offer an equity investment that can be sustained even in times of crisis. So far, we have succeeded in doing that."

 

"We don't buy shares without dividends"

To make his strategy work, Schuessler and his co-fund managers Stephan Werner, Jarrid Klug and Madeleine Ronner focus on stocks that are expected to have an above-average dividend yield and growing dividend payments. The physicist with a doctorate in physics does not back away from this motto even if it brings him disadvantages in terms of performance in the meantime: "If the prices of growth stocks, which usually do not pay dividends, go through the roof, we will not switch to buying expensive technology stocks, for example," Schuessler alludes to the Corona year 2020 and the time thereafter. The year 2022 has once again impressively shown that trends do not last forever and that dividend stocks can act as a stabilizer in a portfolio, especially in turbulent times. Schuessler says, "We don't buy stocks without dividends."

 

Sustainable trend reversal? Value and dividend stocks favorably valued

After years of dominance by growth stocks, has the trend turned in favor of dividend and value stocks sustainably in 2022? "The chances are good," says Schuessler. "In phases of high inflation and rising interest rates, as we are currently experiencing, dividend stocks can play to their strength, as stability and valuation are more in focus," explains Schuessler. Value and dividend stocks are currently still relatively cheaply valued compared to growth stocks, he adds^[5]. To be sure, rising interest rates could weigh on prices. "However, well-positioned dividend payers generally cope better with higher interest rates than growth stocks," says Schuessler. With regard to a probable recession, the portfolio manager remains relatively relaxed: Even though an economic downturn usually doesn't leave stocks unscathed, it doesn't automatically lead to dividend shortfalls: "Even in the 2008 financial crisis, we had significantly more companies in the fund that increased their dividends than those that cut them." Currently, the portfolio has an average dividend yield of 4 percent^[6].

 

Pharmaceuticals, utilities and Co.: focus on defensive stocks

In which sectors is the DWS Top Dividende currently finding its way? Reliable dividend payers can be found in particular in the pharmaceuticals, utilities and non-cyclical consumer sectors. These sectors have in common that they are relatively independent of economic ups and downs. In addition, there are other, changing areas: "In the past few years, for example, we have significantly increased commodity and energy stocks against the trend," Schuessler looks back. In the meantime, he says, there are supply bottlenecks, from which the DWS Top Dividende benefits. In addition, the sector can usually withstand high inflation rates, as a look back at the 1970s shows, for example.

 

Europe currently overweighted

Regionally, the DWS Top Dividende currently has a clear overweight in Europe^[7]. Apart from the relatively favorable valuations of European equities, this is also due to the fact that dividends play a greater role in Europe than in the U.S. where companies rely more on share buybacks than on dividends. As a result, the fund has historically tended to be underweight in the U.S., even more so when U.S. stocks began to gain weight in the MSCI World as tech soared.

 

 

Staying power has paid off

A look at the figures shows that it has been worthwhile for investors to remain loyal to DWS Top Dividende over 20 years: In total, the fund has distributed more than six billion euros to its investors^[8]. 10,000 euros invested at the fund’s start in 2003, would have resulted in 26,898 euros by the end of February 2023. Adding the dividend payouts of 11,940 euros – the initial investment would nearly have quadrupled. With annual reinvestment of the distributions, the total would have been even more than 50,000 euros^[9].

 

20 years DWS Top Dividende - the milestones

April 28, 2003	While the aftermath of the burst technology bubble is still clearly felt and numerous investors have turned their backs on the stock market in disappointment in the face of massive price losses, many companies continue to pay attractive dividends. In order to regain investors' confidence in the stock market, DWS is designing DWS Top Dividende, one of the first globally investing dividend funds in Europe.
September 2005	The fund's assets had already grown to almost four billion euros when Thomas Schuessler became portfolio manager of DWS Top Dividende and, together with his team, further developed the fund's investment process: In addition to traditional dividend indicators such as the dividend yield, dividend growth and the payout ratio now also play an important role in stock selection.
2008	The financial crisis is shaking the markets. DWS Top Dividende is also unable to escape the global downward trend. Although the fund recorded a loss in value of 38 percent at its peak, the bottom line is that it suffers less than the broad market (measured by the MSCI World Index).
2012/2013	Following the financial crisis and the euro crisis, investors put a further five billion euros in the hands of Thomas Schuessler and team in 2012 and 2013 alone – partly because, in view of ever falling interest rates, there is increasing demand for higher-yielding investment alternatives.
April 2017	DWS Top Dividende breaks the 10 billion euro mark in assets under management.
September 2019	DWS Top Dividende reaches over 20 billion euros in assets under management for the first time.
2022	High inflation, rising interest rates: After a historically long phase of better performance by growth stocks, dividend stocks are making a comeback.
Februar 2023	The business and investor magazine Euro awards Thomas Schuessler the Golden Bull as "Fund Manager of the Year 2023".
April 28, 2023	The DWS Top Dividende turns 20. An investor who had regularly invested 100 euros in the fund every month from the start via a savings plan would have made 33,436 euros at the end of February 2023, not including dividend distributions of 9,345 euros[10].

 

DWS Top Dividende LD

Fund data

WKN / ISIN: 984811 / DE0009848119

Total assets: 19.994,00 million euros (as of 04/26/2023)

Distribution policy: Distribution

Front-end Load: 5.00 %

Current costs: 1.46% (as of 09/30/2022)

All-in fee: 1.45 %

 

Risks

The fund invests in equities. Equities are subject to price fluctuations and therefore also to the risk of price declines. The fund seeks income from dividends, i.e. expected distributions per share. If a company pays a lower dividend than expected or pays no dividend at all, the value of shares or derivatives may be negatively affected as a result. The fund may also invest in assets that are not denominated in euros. This may cause your investment to fall in value if the euro rate rises against these currencies. Due to its composition/the techniques used by the fund management, the investment fund exhibits increased volatility, i.e. unit prices may be subject to greater downward or upward fluctuations even within short periods of time. The unit value may at any time fall below the purchase price at which the customer acquired the unit.

 

Performance in the past 12-month periods^[11]

 

Period                                                   Net                         Gross

26.04.2022 - 26.04.2023                 -3.18%                  -3.18%

26.04.2021 - 26.04.2022                 17.02%                  17.02%

26.04.2020 - 26.04.2021                 11,14%                  11.14%

26.04.2019 - 26.04.2020                 -4.66%                  -4.66%

26.04.2018 - 26.04.2019                 14.05%                  14.05%

26.04.2017 - 26.04.2018                 -7.92%                  -7.92%

26.04.2016 - 26.04.2017                 10.87%                  10.87%

26.04.2015 - 26.04.2016                 -2.71%                  -2.71%

26.04.2014 - 26.04.2015                 33.30%                  33.30%

26.04.2013 - 26.04.2014                 -0.55%                  4.42%

 

Important notes

All expressions of opinion reflect current views, which are subject to change without notice. Forecasts are based on assumptions, estimates, opinions and hypothetical models or analyses that may prove to be inaccurate or incorrect. Past performance is not a reliable indicator of future performance.