Long-term Outperformance

Every stock in Shearer's fund must pay a dividend, even if it's small. "We like the discipline a dividend instills on company management," he says.

Shearer points to data showing dividend-paying stocks outperforming both the broad stock indexes and non-dividend-paying stocks over the long term. The BlackRock fund's 111 stocks tend to be large U.S. companies--the median company in the fund has a market capitalization of $27 billion, and all but 9 percent are based in the U.S.