We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Take Shelter in Dividend Aristocrat ETFs Amid Ukraine-Russia War
Read MoreHide Full Article
Wall Street has begun March on a dull note after a weak February. The Dow Jones Industrial Average was down 1.8% on Mar 1. The S&P 500 and Nasdaq Composite indices have also lost about 1.6% each on the same day. The market participants are feeling pressure from the ongoing Russia-Ukraine conflict and its impact on the global economies.
Investors willing to sail through the current market turbulences from the latest COVID-19 variant-related concerns can consider Vanguard Dividend Appreciation ETF (VIG - Free Report) , SPDR S&P Dividend ETF (SDY - Free Report) , iShares Select Dividend ETF (DVY - Free Report) , ProShares S&P 500 Dividend Aristocrats ETF (NOBL - Free Report) and iShares Core Dividend Growth ETF (DGRO - Free Report) .
Investors have been closely tracking the updates on the Russia-Ukraine war. Russia advancing to Kyiv, the Ukrainian capital, with a long convoy caused weakness in the stock markets. Per a CNN report, Russian defense ministry spokesperson Maj. Gen. Igor Konashenkov has informed that the Russian force has taken complete control of the city of Kherson. Moreover, Ukraine’s northeast city of Kharkiv has witnessed major destruction (according to a CNN report). Notably, Kharkiv is the second-largest city in Ukraine, with a population of about 1.4 million people.
In retaliation to Russia’s aggressive advancement, the sanctions on Moscow continue to pile up from the United States, European Union and other Western allies. The European Union has informed about imposing sanctions against more than two dozen Russians, including President Vladimir Putin’s press secretary (per a CNBC article). Oil giants like BP, Shell and Exxon Mobil have abandoned Russia, which can be a huge blow for the country.
The latest developments can slowdown production activities and impact the export of commodities and goods. The surging commodity prices can have a far-reaching impact on global economies like the United States and the U.K., recovering from the pandemic-led slowdown and high inflation levels.
Commenting on the current market conditions, Adam Crisafulli of Vital Knowledge has said that “Stocks are mostly for sale, and the underlying price action is worse than the headline indices make it seem ... Russia/Ukraine uncertainty remains the primary theme and there still isn’t enough clarity for stocks to feel comfortable stabilizing,” as stated in a CNBC article.
Why Consider Dividend Aristocrat ETFs?
Dividend aristocrats are blue-chip dividend-paying companies with a long track record of increasing dividend payments year over year. Moreover, dividend aristocrat funds give investors dividend growth opportunities compared to other products in the space but might not necessarily have the highest yields.
‘Dividend aristocrats’ or ‘dividend growers’ are mostly deemed the smartest way to deal with market turmoil. The inclination toward dividend investing is rising because of easing monetary policy on the global front, the market uncertainty triggered by the pandemic, geopolitical tensions and deceleration in global growth. Demand for these funds is mainly driven by their characteristic of being the major source of consistent income for investors when returns from the equity markets are uncertain.
These products also form a strong portfolio with a higher scope of capital appreciation against simple dividend-paying stocks or those with high yields. As a result, these products deliver an excellent combination of annual dividend growth and capital-appreciation opportunity and are most beneficial to risk-averse long-term investors.
Against this backdrop, let’s take a look at some ETFs that investors can consider:
Vanguard Dividend Appreciation ETF is the largest and the most popular ETF in the dividend space, with AUM of $64.50 billion. VIG follows the S&P U.S. Dividend Growers Index. Vanguard Dividend Appreciation ETF charges 6 basis points (bps) in annual fees (read: ETF Strategies to Conquer Geopolitical & Fed Rate Hike Worries).
SPDR S&P Dividend ETF seeks to provide investment results that before fees and expenses correspond generally to the total return performance of the S&P High Yield Dividend Aristocrats Index. The index screens companies that consistently increased their dividend for at least 20 consecutive years. SDY has AUM of $20.38 billion. SPDR S&P Dividend ETF charges 35 bps in fees per year (read: Guide to Dividend Aristocrat ETFs).
iShares Select Dividend ETF provides exposure to broad-cap U.S. companies with a consistent history of dividends and tracks the Dow Jones U.S. Select Dividend Index. DVY has AUM of $20.59 billion. iShares Select Dividend ETF charges 38 bps in fees per year (as stated in the prospectus).
ProShares S&P 500 Dividend Aristocrats ETF seeks investment results before fees and expenses that track the performance of the S&P 500 Dividend Aristocrats Index. NOBL is the only ETF focusing exclusively on the S&P 500 Dividend Aristocrats, which are high-quality companies that not just paid out dividends but also raised the same for at least 25 consecutive years, with most doing so for 40 years or more. NOBL amassed $9.76 billion in its asset base. ProShares S&P 500 Dividend Aristocrats ETF has an expense ratio of 0.35% (read: 5 ETFs to Tackle Ukraine-Russia War, Inflation & Fed Rate Hike Woes).
This fund provides exposure to companies boasting a history of sustained dividend growth by tracking the Morningstar US Dividend Growth Index. DGRO has AUM of $22.84 billion. iShares Core Dividend Growth ETF charges 8 bps in fees per year.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Shutterstock
Take Shelter in Dividend Aristocrat ETFs Amid Ukraine-Russia War
Wall Street has begun March on a dull note after a weak February. The Dow Jones Industrial Average was down 1.8% on Mar 1. The S&P 500 and Nasdaq Composite indices have also lost about 1.6% each on the same day. The market participants are feeling pressure from the ongoing Russia-Ukraine conflict and its impact on the global economies.
Investors willing to sail through the current market turbulences from the latest COVID-19 variant-related concerns can consider Vanguard Dividend Appreciation ETF (VIG - Free Report) , SPDR S&P Dividend ETF (SDY - Free Report) , iShares Select Dividend ETF (DVY - Free Report) , ProShares S&P 500 Dividend Aristocrats ETF (NOBL - Free Report) and iShares Core Dividend Growth ETF (DGRO - Free Report) .
Investors have been closely tracking the updates on the Russia-Ukraine war. Russia advancing to Kyiv, the Ukrainian capital, with a long convoy caused weakness in the stock markets. Per a CNN report, Russian defense ministry spokesperson Maj. Gen. Igor Konashenkov has informed that the Russian force has taken complete control of the city of Kherson. Moreover, Ukraine’s northeast city of Kharkiv has witnessed major destruction (according to a CNN report). Notably, Kharkiv is the second-largest city in Ukraine, with a population of about 1.4 million people.
In retaliation to Russia’s aggressive advancement, the sanctions on Moscow continue to pile up from the United States, European Union and other Western allies. The European Union has informed about imposing sanctions against more than two dozen Russians, including President Vladimir Putin’s press secretary (per a CNBC article). Oil giants like BP, Shell and Exxon Mobil have abandoned Russia, which can be a huge blow for the country.
The latest developments can slowdown production activities and impact the export of commodities and goods. The surging commodity prices can have a far-reaching impact on global economies like the United States and the U.K., recovering from the pandemic-led slowdown and high inflation levels.
Commenting on the current market conditions, Adam Crisafulli of Vital Knowledge has said that “Stocks are mostly for sale, and the underlying price action is worse than the headline indices make it seem ... Russia/Ukraine uncertainty remains the primary theme and there still isn’t enough clarity for stocks to feel comfortable stabilizing,” as stated in a CNBC article.
Why Consider Dividend Aristocrat ETFs?
Dividend aristocrats are blue-chip dividend-paying companies with a long track record of increasing dividend payments year over year. Moreover, dividend aristocrat funds give investors dividend growth opportunities compared to other products in the space but might not necessarily have the highest yields.
‘Dividend aristocrats’ or ‘dividend growers’ are mostly deemed the smartest way to deal with market turmoil. The inclination toward dividend investing is rising because of easing monetary policy on the global front, the market uncertainty triggered by the pandemic, geopolitical tensions and deceleration in global growth. Demand for these funds is mainly driven by their characteristic of being the major source of consistent income for investors when returns from the equity markets are uncertain.
These products also form a strong portfolio with a higher scope of capital appreciation against simple dividend-paying stocks or those with high yields. As a result, these products deliver an excellent combination of annual dividend growth and capital-appreciation opportunity and are most beneficial to risk-averse long-term investors.
Against this backdrop, let’s take a look at some ETFs that investors can consider:
Vanguard Dividend Appreciation ETF (VIG - Free Report)
Vanguard Dividend Appreciation ETF is the largest and the most popular ETF in the dividend space, with AUM of $64.50 billion. VIG follows the S&P U.S. Dividend Growers Index. Vanguard Dividend Appreciation ETF charges 6 basis points (bps) in annual fees (read: ETF Strategies to Conquer Geopolitical & Fed Rate Hike Worries).
SPDR S&P Dividend ETF (SDY - Free Report)
SPDR S&P Dividend ETF seeks to provide investment results that before fees and expenses correspond generally to the total return performance of the S&P High Yield Dividend Aristocrats Index. The index screens companies that consistently increased their dividend for at least 20 consecutive years. SDY has AUM of $20.38 billion. SPDR S&P Dividend ETF charges 35 bps in fees per year (read: Guide to Dividend Aristocrat ETFs).
iShares Select Dividend ETF (DVY - Free Report)
iShares Select Dividend ETF provides exposure to broad-cap U.S. companies with a consistent history of dividends and tracks the Dow Jones U.S. Select Dividend Index. DVY has AUM of $20.59 billion. iShares Select Dividend ETF charges 38 bps in fees per year (as stated in the prospectus).
ProShares S&P 500 Dividend Aristocrats ETF (NOBL - Free Report)
ProShares S&P 500 Dividend Aristocrats ETF seeks investment results before fees and expenses that track the performance of the S&P 500 Dividend Aristocrats Index. NOBL is the only ETF focusing exclusively on the S&P 500 Dividend Aristocrats, which are high-quality companies that not just paid out dividends but also raised the same for at least 25 consecutive years, with most doing so for 40 years or more. NOBL amassed $9.76 billion in its asset base. ProShares S&P 500 Dividend Aristocrats ETF has an expense ratio of 0.35% (read: 5 ETFs to Tackle Ukraine-Russia War, Inflation & Fed Rate Hike Woes).
iShares Core Dividend Growth ETF (DGRO - Free Report)
This fund provides exposure to companies boasting a history of sustained dividend growth by tracking the Morningstar US Dividend Growth Index. DGRO has AUM of $22.84 billion. iShares Core Dividend Growth ETF charges 8 bps in fees per year.