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Why High Dividend, Low Volatility ETFs are Beating the Market
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Stocks remain under pressure as high inflation and rising interest rates continue to weigh on investor sentiment. Many investors are looking for safety in defensive areas of the market while dumping high-growth tech stocks that are more sensitive to interest rates.
Dividend paying stocks look attractive to income focused investors in the rising rate environment, which is quite negative for bonds. Dividend stocks also tend to outperform during volatile markets and can reduce volatility of a portfolio.
Adding another screen of low volatility and focusing on high quality companies with steady and growing payouts could be a great strategy for investors. Such ETFs have significantly outperformed the broader indexes this year.
The Invesco S&P 500 High Dividend Low Volatility ETF (SPHD - Free Report) holds 50 least volatile, highest dividend-yielding stocks in the S&P 500 index. The Williams Companies (WMB - Free Report) and Chevron (CVX - Free Report) are its top holdings.
The Legg Mason Low Volatility High Dividend ETF (LVHD - Free Report) invests in stocks with high dividends, low price volatility and low earnings volatility. Lockheed Martin (LMT - Free Report) and Johnson & Johnson (JNJ - Free Report) are its top holdings.
The VictoryShares U.S. Large Cap High Div Volatility Wtd ETF (CDL - Free Report) holds higher dividend paying stocks weighted by inverse volatility. Costco Wholesale (COST - Free Report) and PepsiCo (PEP - Free Report) are among the top holdings.
To learn more about these ETFs, please watch the short video above.
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Why High Dividend, Low Volatility ETFs are Beating the Market
Stocks remain under pressure as high inflation and rising interest rates continue to weigh on investor sentiment. Many investors are looking for safety in defensive areas of the market while dumping high-growth tech stocks that are more sensitive to interest rates.
Dividend paying stocks look attractive to income focused investors in the rising rate environment, which is quite negative for bonds. Dividend stocks also tend to outperform during volatile markets and can reduce volatility of a portfolio.
Adding another screen of low volatility and focusing on high quality companies with steady and growing payouts could be a great strategy for investors. Such ETFs have significantly outperformed the broader indexes this year.
The Invesco S&P 500 High Dividend Low Volatility ETF (SPHD - Free Report) holds 50 least volatile, highest dividend-yielding stocks in the S&P 500 index. The Williams Companies (WMB - Free Report) and Chevron (CVX - Free Report) are its top holdings.
The Legg Mason Low Volatility High Dividend ETF (LVHD - Free Report) invests in stocks with high dividends, low price volatility and low earnings volatility. Lockheed Martin (LMT - Free Report) and Johnson & Johnson (JNJ - Free Report) are its top holdings.
The VictoryShares U.S. Large Cap High Div Volatility Wtd ETF (CDL - Free Report) holds higher dividend paying stocks weighted by inverse volatility. Costco Wholesale (COST - Free Report) and PepsiCo (PEP - Free Report) are among the top holdings.
To learn more about these ETFs, please watch the short video above.