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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 $788.79 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. Considered a more stable option, large cap companies boast more predictable cash flows and are less volatile than their mid and small cap counterparts.
Carrying lower than average price-to-earnings and price-to-book ratios, value stocks also have lower than average sales and earnings growth rates. When you look at long-term performance, value stocks have outperformed growth stocks in nearly all markets. But in strong bull markets, growth stocks are more likely to be winners.
Costs
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.
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 3.45%.
Sector Exposure and Top Holdings
It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Financials sector--about 23% of the portfolio. Healthcare and Utilities round out the top three.
Looking at individual holdings, Cardinal Health Inc (CAH - Free Report) accounts for about 5.65% of total assets, followed by Valero Energy Corp (VLO - Free Report) and Chevron Corp (CVX - Free Report) .
The top 10 holdings account for about 49.11% 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 S&P 900 Dividend Revenue-Weighted Index is constructed using a rules-based methodology that starts with the S&P 900 Index, subject to a maximum 5% per company weighting.
The ETF has lost about -1.19% so far this year and is up roughly 3.93% in the last one year (as of 10/24/2022). In the past 52-week period, it has traded between $37.70 and $45.48.
The ETF has a beta of 1.06 and standard deviation of 31.84% for the trailing three-year period, making it a medium risk choice in the space. With about 61 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 sufficient 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 $49.95 billion in assets, Vanguard Value ETF has $96.05 billion. IWD has an expense ratio of 0.18% and VTV charges 0.04%.
Bottom-Line
An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they 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 $788.79 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. Considered a more stable option, large cap companies boast more predictable cash flows and are less volatile than their mid and small cap counterparts.
Carrying lower than average price-to-earnings and price-to-book ratios, value stocks also have lower than average sales and earnings growth rates. When you look at long-term performance, value stocks have outperformed growth stocks in nearly all markets. But in strong bull markets, growth stocks are more likely to be winners.
Costs
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.
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 3.45%.
Sector Exposure and Top Holdings
It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Financials sector--about 23% of the portfolio. Healthcare and Utilities round out the top three.
Looking at individual holdings, Cardinal Health Inc (CAH - Free Report) accounts for about 5.65% of total assets, followed by Valero Energy Corp (VLO - Free Report) and Chevron Corp (CVX - Free Report) .
The top 10 holdings account for about 49.11% 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 S&P 900 Dividend Revenue-Weighted Index is constructed using a rules-based methodology that starts with the S&P 900 Index, subject to a maximum 5% per company weighting.
The ETF has lost about -1.19% so far this year and is up roughly 3.93% in the last one year (as of 10/24/2022). In the past 52-week period, it has traded between $37.70 and $45.48.
The ETF has a beta of 1.06 and standard deviation of 31.84% for the trailing three-year period, making it a medium risk choice in the space. With about 61 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 sufficient 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 $49.95 billion in assets, Vanguard Value ETF has $96.05 billion. IWD has an expense ratio of 0.18% and VTV charges 0.04%.
Bottom-Line
An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they 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.