Unexpectedly Intriguing!
23 February 2023
Turned On Projector Photo, by Jeremy Yap via Unsplash - https://unsplash.com/photos/J39X2xX_8CQ

Since the beginning of the year, we've made frequent mentions of the improving outlook for the dividends of the S&P 500 (Index: SPX) in our weekly S&P 500 chaos series. Because it's time to take a mid-quarter of the expectations for the index' dividends per share as part of another of our ongoing series, we're turning to basic animation to show when and by how much those expectations have changed since the end of 2022.

Let's set the stage. December 2022 was a gloomy month for the expected future of the S&P 500's dividends. From 5 December 2022 onward, there was very little movement in the dividends per share expected to be paid out in each of the future quarters of 2023. Worse, the CME Group's S&P 500 quarterly dividend futures projected dividend payouts would decline during the third and fourth quarters of 2023. With those values below the same quarters in 2022, the CME Group's futures were signaling a dividend recession in the second half of 2023.

In the following animated chart, we'll pick up the action from 30 December 2022 and proceed day-by-trading day thorugh 15 February 2023. If you read the latest installment of the S&P 500 chaos series, you already have a good idea of when the main event begins.

Animation: Past and Projected S&P 500 Quarterly Dividends per Share Futures, 2021-Q4 through 2023-Q4, 30 December 2022 through 15 February 2023

In case you missed it, the period around 6 January 2023 looks to be a significant in marking the end of the old regime and the beginning of a new one for the U.S. stock market. Meanwhile, as of the midpoint of 2023-Q1, the CME Group's S&P 500 quarterly dividend futures are no longer signaling a year-over-year decline in the index' quarterly dividend payouts during 2023.

More About Dividend Futures Data

The dividend futures data we visualized in the animated chart is based on our records of the S&P 500's Quarterly Dividend Index Futures reported by the CME Group on each trading day from 30 December 2022 through 15 February 2023.

Dividend futures indicate the amount of dividends per share to be paid out over the period covered by each quarters dividend futures contracts, which start on the day after the preceding quarter's dividend futures contracts expire and end on the third Friday of the month ending the indicated quarter. So for example, as determined by dividend futures contracts, the now "current" quarter of 2023-Q1 began on Saturday, 17 December 2022 and will end on Friday, 16 March 2023.

That makes these figures different from the quarterly dividends per share figures reported by Standard and Poor. S&P reports the amount of dividends per share paid out during regular calendar quarters after the end of each quarter. This term mismatch accounts for the differences in dividends reported by both sources, with the biggest differences between the two typically seen in the first and fourth quarters of each year.

Because we're not mixing S&P's data with the CME Group's dividend futures data, the animated chart is providing an apples-to-apples comparison for the different snapshots in time of investor expectations.

Previously on Political Calculations

Image credit: Photo by Jeremy Yap on Unsplash.

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Welcome to the blogosphere's toolchest! Here, unlike other blogs dedicated to analyzing current events, we create easy-to-use, simple tools to do the math related to them so you can get in on the action too! If you would like to learn more about these tools, or if you would like to contribute ideas to develop for this blog, please e-mail us at:

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