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Is Global X SuperDividend U.S. ETF (DIV) a Strong ETF Right Now?
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The Global X SuperDividend U.S. ETF (DIV - Free Report) made its debut on 03/11/2013, and is a smart beta exchange traded fund that provides broad exposure to the Style Box - All Cap Value category of the market.
What Are Smart Beta ETFs?
For a long time now, the ETF industry has been flooded with products based on market capitalization weighted indexes, which are designed to represent the broader market or a particular market segment.
Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
If you're the kind of investor who would rather try and beat the market through good stock selection, then smart beta funds are your best choice; this fund class is known for tracking non-cap weighted strategies.
Non-cap weighted indexes try to choose stocks that have a better chance of risk-return performance, which is based on specific fundamental characteristics, or a mix of other such characteristics.
Even though this space provides many choices to investors--think one of the simplest methodologies like equal-weighting and more complicated ones like fundamental and volatility/momentum based weighting--not all have been able to deliver first-rate results.
Fund Sponsor & Index
The fund is managed by Global X Management, and has been able to amass over $611.70 million, which makes it one of the larger ETFs in the Style Box - All Cap Value. This particular fund, before fees and expenses, seeks to match the performance of the INDXX SuperDividend U.S. Low Volatility Index.
The INDXX SuperDividend U.S. Low Volatility Index tracks the performance of 50 equally weighted common stocks, MLPs & REITs that rank among the highest dividend yielding equity securities in the US.
Cost & Other Expenses
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Operating expenses on an annual basis are 0.45% for this ETF, which makes it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 6.98%.
Sector Exposure and Top Holdings
ETFs offer diversified exposure and thus minimize single stock risk, but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Energy sector - about 28% of the portfolio. Financials and Consumer Staples round out the top three.
Looking at individual holdings, Virtu Financia-A (VIRT - Free Report) accounts for about 2.23% of total assets, followed by Usa Compression (USAC - Free Report) and Avangrid Inc (AGR - Free Report) .
The top 10 holdings account for about 21.59% of total assets under management.
Performance and Risk
The ETF return is roughly 1.25% so far this year and was up about 10.73% in the last one year (as of 05/06/2024). In the past 52-week period, it has traded between $15.43 and $17.43.
The fund has a beta of 1.04 and standard deviation of 14.36% for the trailing three-year period, which makes DIV a medium risk choice in this particular space. With about 52 holdings, it effectively diversifies company-specific risk.
Alternatives
Global X SuperDividend U.S. ETF is a reasonable option for investors seeking to outperform the Style Box - All Cap Value segment of the market. However, there are other ETFs in the space which investors could consider.
Capital Group Dividend Growers ETF (CGDG - Free Report) tracks ---------------------------------------- and the Global X SuperDividend ETF (SDIV - Free Report) tracks Solactive Global SuperDividend Index. Capital Group Dividend Growers ETF has $322.05 million in assets, Global X SuperDividend ETF has $771.15 million. CGDG has an expense ratio of 0.47% and SDIV charges 0.58%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Style Box - All Cap Value.
Bottom Line
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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Is Global X SuperDividend U.S. ETF (DIV) a Strong ETF Right Now?
The Global X SuperDividend U.S. ETF (DIV - Free Report) made its debut on 03/11/2013, and is a smart beta exchange traded fund that provides broad exposure to the Style Box - All Cap Value category of the market.
What Are Smart Beta ETFs?
For a long time now, the ETF industry has been flooded with products based on market capitalization weighted indexes, which are designed to represent the broader market or a particular market segment.
Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
If you're the kind of investor who would rather try and beat the market through good stock selection, then smart beta funds are your best choice; this fund class is known for tracking non-cap weighted strategies.
Non-cap weighted indexes try to choose stocks that have a better chance of risk-return performance, which is based on specific fundamental characteristics, or a mix of other such characteristics.
Even though this space provides many choices to investors--think one of the simplest methodologies like equal-weighting and more complicated ones like fundamental and volatility/momentum based weighting--not all have been able to deliver first-rate results.
Fund Sponsor & Index
The fund is managed by Global X Management, and has been able to amass over $611.70 million, which makes it one of the larger ETFs in the Style Box - All Cap Value. This particular fund, before fees and expenses, seeks to match the performance of the INDXX SuperDividend U.S. Low Volatility Index.
The INDXX SuperDividend U.S. Low Volatility Index tracks the performance of 50 equally weighted common stocks, MLPs & REITs that rank among the highest dividend yielding equity securities in the US.
Cost & Other Expenses
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Operating expenses on an annual basis are 0.45% for this ETF, which makes it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 6.98%.
Sector Exposure and Top Holdings
ETFs offer diversified exposure and thus minimize single stock risk, but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Energy sector - about 28% of the portfolio. Financials and Consumer Staples round out the top three.
Looking at individual holdings, Virtu Financia-A (VIRT - Free Report) accounts for about 2.23% of total assets, followed by Usa Compression (USAC - Free Report) and Avangrid Inc (AGR - Free Report) .
The top 10 holdings account for about 21.59% of total assets under management.
Performance and Risk
The ETF return is roughly 1.25% so far this year and was up about 10.73% in the last one year (as of 05/06/2024). In the past 52-week period, it has traded between $15.43 and $17.43.
The fund has a beta of 1.04 and standard deviation of 14.36% for the trailing three-year period, which makes DIV a medium risk choice in this particular space. With about 52 holdings, it effectively diversifies company-specific risk.
Alternatives
Global X SuperDividend U.S. ETF is a reasonable option for investors seeking to outperform the Style Box - All Cap Value segment of the market. However, there are other ETFs in the space which investors could consider.
Capital Group Dividend Growers ETF (CGDG - Free Report) tracks ---------------------------------------- and the Global X SuperDividend ETF (SDIV - Free Report) tracks Solactive Global SuperDividend Index. Capital Group Dividend Growers ETF has $322.05 million in assets, Global X SuperDividend ETF has $771.15 million. CGDG has an expense ratio of 0.47% and SDIV charges 0.58%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Style Box - All Cap Value.
Bottom Line
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.