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Should Invesco S&P Ultra Dividend Revenue ETF (RDIV) Be on Your Investing Radar?
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If you're interested in broad exposure to the Large Cap Value segment of the US equity market, look no further than the Invesco S&P Ultra Dividend Revenue ETF (RDIV - Free Report) , a passively managed exchange traded fund launched on 10/01/2013.
The fund is sponsored by Invesco. It has amassed assets over $720.49 million, making it one of the average sized ETFs attempting to match the Large Cap Value segment of the US equity market.
Why Large Cap Value
Large cap companies typically have a market capitalization above $10 billion. Overall, they are usually a stable option, with less risk and more sure-fire cash flows than mid and small cap companies.
While value stocks have lower than average price-to-earnings and price-to-book ratios, they also have lower than average sales and earnings growth rates. Value stocks have outperformed growth stocks in nearly all markets when you consider long-term performance, growth stocks are more likely to outpace value stocks in strong bull markets.
Costs
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.39%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 4.66%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Utilities sector--about 30.80% of the portfolio. Financials and Healthcare round out the top three.
Looking at individual holdings, Pfizer Inc (PFE - Free Report) accounts for about 5.16% of total assets, followed by Verizon Communications Inc (VZ - Free Report) and Southern Co/the (SO - Free Report) .
The top 10 holdings account for about 44.29% of total assets under management.
Performance and Risk
RDIV seeks to match the performance of the OFI Revenue Weighted Ultra Dividend Index before fees and expenses. The OFI Revenue Weighted Ultra Dividend Index is constructed by identifying the top 60 securities from the S&P 900 Index with the highest average of the 1-year trailing dividend yields for the current quarter and each of the past three quarters which are then re-weighted according to the revenue earned by the companies.
The ETF has gained about 26.06% so far this year and was up about 25.45% in the last one year (as of 12/15/2021). In the past 52-week period, it has traded between $33.09 and $43.55.
The ETF has a beta of 1.26 and standard deviation of 31.48% for the trailing three-year period, making it a medium risk choice in the space. With about 71 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco S&P Ultra Dividend Revenue ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, RDIV is a reasonable option for those seeking exposure to the Style Box - Large Cap Value area of the market. Investors might also want to consider some other ETF options in the space.
The iShares Russell 1000 Value ETF (IWD - Free Report) and the Vanguard Value ETF (VTV - Free Report) track a similar index. While iShares Russell 1000 Value ETF has $57.82 billion in assets, Vanguard Value ETF has $88.94 billion. IWD has an expense ratio of 0.19% and VTV charges 0.04%.
Bottom-Line
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also excellent vehicles for long term investors.
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
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Should Invesco S&P Ultra Dividend Revenue ETF (RDIV) Be on Your Investing Radar?
If you're interested in broad exposure to the Large Cap Value segment of the US equity market, look no further than the Invesco S&P Ultra Dividend Revenue ETF (RDIV - Free Report) , a passively managed exchange traded fund launched on 10/01/2013.
The fund is sponsored by Invesco. It has amassed assets over $720.49 million, making it one of the average sized ETFs attempting to match the Large Cap Value segment of the US equity market.
Why Large Cap Value
Large cap companies typically have a market capitalization above $10 billion. Overall, they are usually a stable option, with less risk and more sure-fire cash flows than mid and small cap companies.
While value stocks have lower than average price-to-earnings and price-to-book ratios, they also have lower than average sales and earnings growth rates. Value stocks have outperformed growth stocks in nearly all markets when you consider long-term performance, growth stocks are more likely to outpace value stocks in strong bull markets.
Costs
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.39%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 4.66%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Utilities sector--about 30.80% of the portfolio. Financials and Healthcare round out the top three.
Looking at individual holdings, Pfizer Inc (PFE - Free Report) accounts for about 5.16% of total assets, followed by Verizon Communications Inc (VZ - Free Report) and Southern Co/the (SO - Free Report) .
The top 10 holdings account for about 44.29% of total assets under management.
Performance and Risk
RDIV seeks to match the performance of the OFI Revenue Weighted Ultra Dividend Index before fees and expenses. The OFI Revenue Weighted Ultra Dividend Index is constructed by identifying the top 60 securities from the S&P 900 Index with the highest average of the 1-year trailing dividend yields for the current quarter and each of the past three quarters which are then re-weighted according to the revenue earned by the companies.
The ETF has gained about 26.06% so far this year and was up about 25.45% in the last one year (as of 12/15/2021). In the past 52-week period, it has traded between $33.09 and $43.55.
The ETF has a beta of 1.26 and standard deviation of 31.48% for the trailing three-year period, making it a medium risk choice in the space. With about 71 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco S&P Ultra Dividend Revenue ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, RDIV is a reasonable option for those seeking exposure to the Style Box - Large Cap Value area of the market. Investors might also want to consider some other ETF options in the space.
The iShares Russell 1000 Value ETF (IWD - Free Report) and the Vanguard Value ETF (VTV - Free Report) track a similar index. While iShares Russell 1000 Value ETF has $57.82 billion in assets, Vanguard Value ETF has $88.94 billion. IWD has an expense ratio of 0.19% and VTV charges 0.04%.
Bottom-Line
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also excellent vehicles for long term investors.
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.