The reason I like VHY is actually because they don't have...

The reason I like VHY is actually because they don't have control over what goes into their basket and it is very blind at times - eg Slater & Gordon wasn't too great. But you also got Downer EDI which had a big bump up 30% recently as well by this method, which presumably wasn't easily predictable. I think the reality is that no one really knows what's going to happen in the share market, and so that's why blind indexes outperform 80-90% of professionally managed hedged funds (and why Buffett is winning his bet that Vanguard's US Admiralty can beat a bunch of hedge funds).

Another reason is that Aussie's basically don't like stocks. If you ask 10 random Aussies what they would do with 1 million, I guarantee you that almost none of them would buy many stocks. They would all put it into property investments. I asked around and I couldn't find even one person willing to put a free 1 million into stocks. And so I think if you're game plan is capital growth, well, good luck, because Australians don't believe in stocks and so you're going to have a much harder job than you would with the same good quality company as in America. So going hard in favour of dividends does seem not too bad an idea in the Aussie context of pretty everyone preferring investment properties (that and super small caps that can explode in SP value).