DivGro

DivGro is a boutique global investment management firm. Our fund harnesses the power of rising dividends to create a growing income stream and high capital growth. DivGro helps to overcome behavioral and emotional difficulties involved in holding listed securities. DivGro has featured in the AFR, The Australian, Morningstar, ausbiz and Capital Brief. How we work: At the heart of DivGro lie dividends. Not just any dividends: only those that grow rapidly and consistently and are paid by outstanding companies. Why? Because dividend changes are the most reliable proxies for true company performance. (Plus, they are universally understood and easy to feel given they are paid in cash). But how do we know this to be true? Enter the Gordon Growth Model. In the late 1950s, MIT professor Myron Gordon and his team set out to find the most reliable indicator of a company’s true performance. Their discovery? Over time, share prices tend to rise in line with dividend growth. Simply put, if a company grows its dividend by 13% per year, its share price is expected to grow at a similar rate. This insight reinforces a simple truth—focusing on dividend growth can be a powerful way to build long-term wealth. In other words, where the dividend goes, the share price follows. On that basis, DivGro developed its philosophy whereby: → If you could identify uninterrupted fast dividend growth companies (i.e., companies which grow their dividends rapidly and consistently every year) and; → If you on-paid and encouraged investors to track and anticipate those receipts in their bank accounts and; → If you communicated this dividend growth progress actively, systematically, and understandably, then: DivGro arms investors with a sound psychological framework. This enables investors to follow a company’s true underlying value rather than focus on the erratic behaviour of its share price and therefore bolsters the likelihood of achieving their desired investment outcomes.