You might not realize it, but sometimes looking at a stock market index is a helpful way to start your research regarding possible dividend growth investments. For example, the Dow Jones US Utilities index is one I monitor using Fidelity’s Active Trader Pro. If the sector is down on any day, I start to look at adding shares to my favorite dividend growth utilities, including NEE and XEL.
Utilities, like other investments, go in and out of favor. But if you buy a quality utility and reinvest the dividends you will see remarkable growth. For example, my NEE investment is up over 115%. My XEL investment is up over 107%. When the price gets a bit high, I turn off automatic dividend reinvestment. In fact, now that trading costs are zero at Fidelity, it might make more sense to hold the dividend and then decide when to buy and at what price.
Note: on the Fidelity website, you can enter the ticker symbol .DJUSUT to see the index. Don’t forget the “dot” that is before the index name.
Here is a link to the DJUSUT components: https://us.spindices.com/indices/equity/dow-jones-us-utilities-index