Here is one specific way in which it is worse--it may not be important
, but it is are valid and objective reasons why it is worse
Since it is an equally weighted
index of a small part of
the market, rather than a cap-weighted index of almost all of the market, it takes more work and more buying and selling for a fund managers to keep the proportions equalized.
NOBL has a turnover ratio of 21%, not high but higher than
;VTI, with a turnover ratio of 3%.
This is probably an important reason why
NOBL has an expense ratio of 0.35% and
VTI has an expense ratio of only 0.05%.
It is a more expensive index to track, and I think any product that tracks it is likely to have higher costs directly due to the nature of the index itself. Again, 0.30% more is not a whole lot, and a sane person could
believe that the intrinsic coolness of dividend growth stocks might overcome the extra costs.
By the way, I personally have a bias against it just because of the use of an obvious marketing term in the name of the index itself. "Aristocrats" my sweet Fanny Adams. Stocks with high dividend growth should be called something like "high dividend growth stocks," not "Aristocrats" or "Nobility" or "Superheroes" or "Rock stars."
Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness; Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.