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Should Franklin U.S. Low Volatility High Dividend Index ETF (LVHD) Be on Your Investing Radar?
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Designed to provide broad exposure to the Large Cap Value segment of the US equity market, the Franklin U.S. Low Volatility High Dividend Index ETF (LVHD - Free Report) is a passively managed exchange traded fund launched on 12/28/2015.
The fund is sponsored by Franklin Templeton Investments. It has amassed assets over $567.84 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 usually 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
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 0.27%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 3.67%.
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 Utilities sector--about 24.80% of the portfolio. Consumer Staples and Real Estate round out the top three.
Looking at individual holdings, Cisco Systems Inc (CSCO - Free Report) accounts for about 2.85% of total assets, followed by Mcdonald's Corp (MCD - Free Report) and Us Bancorp (USB - Free Report) .
The top 10 holdings account for about 25.6% of total assets under management.
Performance and Risk
LVHD seeks to match the performance of the QS Low Volatility High Dividend Index before fees and expenses. The QS Low Volatility High Dividend Index provides stable income through investment in stocks of profitable U.S. companies with relatively high dividend yields, lower price and earnings volatility.
The ETF has added roughly 15.24% so far this year and is up about 22.49% in the last one year (as of 11/22/2024). In the past 52-week period, it has traded between $34.51 and $41.26.
The ETF has a beta of 0.78 and standard deviation of 13.72% for the trailing three-year period. With about 118 holdings, it effectively diversifies company-specific risk.
Alternatives
Franklin U.S. Low Volatility High Dividend Index ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, LVHD is an outstanding option for investors seeking exposure to the Style Box - Large Cap Value segment of the market. There are other additional ETFs in the space that investors could consider as well.
The Schwab U.S. Dividend Equity ETF (SCHD - Free Report) and the Vanguard Value ETF (VTV - Free Report) track a similar index. While Schwab U.S. Dividend Equity ETF has $66.20 billion in assets, Vanguard Value ETF has $132.22 billion. SCHD has an expense ratio of 0.06% and VTV charges 0.04%.
Bottom-Line
While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.
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 Franklin U.S. Low Volatility High Dividend Index ETF (LVHD) Be on Your Investing Radar?
Designed to provide broad exposure to the Large Cap Value segment of the US equity market, the Franklin U.S. Low Volatility High Dividend Index ETF (LVHD - Free Report) is a passively managed exchange traded fund launched on 12/28/2015.
The fund is sponsored by Franklin Templeton Investments. It has amassed assets over $567.84 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 usually 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
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 0.27%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 3.67%.
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 Utilities sector--about 24.80% of the portfolio. Consumer Staples and Real Estate round out the top three.
Looking at individual holdings, Cisco Systems Inc (CSCO - Free Report) accounts for about 2.85% of total assets, followed by Mcdonald's Corp (MCD - Free Report) and Us Bancorp (USB - Free Report) .
The top 10 holdings account for about 25.6% of total assets under management.
Performance and Risk
LVHD seeks to match the performance of the QS Low Volatility High Dividend Index before fees and expenses. The QS Low Volatility High Dividend Index provides stable income through investment in stocks of profitable U.S. companies with relatively high dividend yields, lower price and earnings volatility.
The ETF has added roughly 15.24% so far this year and is up about 22.49% in the last one year (as of 11/22/2024). In the past 52-week period, it has traded between $34.51 and $41.26.
The ETF has a beta of 0.78 and standard deviation of 13.72% for the trailing three-year period. With about 118 holdings, it effectively diversifies company-specific risk.
Alternatives
Franklin U.S. Low Volatility High Dividend Index ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, LVHD is an outstanding option for investors seeking exposure to the Style Box - Large Cap Value segment of the market. There are other additional ETFs in the space that investors could consider as well.
The Schwab U.S. Dividend Equity ETF (SCHD - Free Report) and the Vanguard Value ETF (VTV - Free Report) track a similar index. While Schwab U.S. Dividend Equity ETF has $66.20 billion in assets, Vanguard Value ETF has $132.22 billion. SCHD has an expense ratio of 0.06% and VTV charges 0.04%.
Bottom-Line
While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.
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.