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Should SPDR Portfolio S&P 500 High Dividend ETF (SPYD) Be on Your Investing Radar?
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The SPDR Portfolio S&P 500 High Dividend ETF (SPYD - Free Report) was launched on 10/21/2015, and is a passively managed exchange traded fund designed to offer broad exposure to the Large Cap Value segment of the US equity market.
The fund is sponsored by State Street Global Advisors. It has amassed assets over $6.78 billion, making it one of the larger ETFs attempting to match the Large Cap Value segment of the US equity market.
Why Large Cap Value
Companies that fall in the large cap category tend to 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.
Value stocks are known for their lower than average price-to-earnings and price-to-book ratios, but investors should also note their lower than average sales and earnings growth rates. Looking at their long-term performance, value stocks have outperformed growth stocks in almost all markets. They are however likely to underperform growth stocks in strong bull markets.
Costs
When considering an ETF's total return, expense ratios are an important factor, and cheaper funds can significantly outperform their more expensive counterparts in the long term if all other factors remain equal.
Annual operating expenses for this ETF are 0.07%, making it one of the least expensive products in the space.
It has a 12-month trailing dividend yield of 4.26%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Real Estate sector--about 22.90% of the portfolio. Financials and Utilities round out the top three.
Looking at individual holdings, Kellanova (K - Free Report) accounts for about 1.72% of total assets, followed by Entergy Corp (ETR - Free Report) and Kinder Morgan Inc (KMI - Free Report) .
The top 10 holdings account for about 15.43% of total assets under management.
Performance and Risk
SPYD seeks to match the performance of the S&P 500 High Dividend Index before fees and expenses. The S&P 500 High Dividend Index is designed to measure the performance of the top 80 dividend-paying securities listed on the S&P 500 Index, based on dividend yield.
The ETF has added roughly 1.20% so far this year and it's up approximately 18.23% in the last one year (as of 01/24/2025). In the past 52-week period, it has traded between $37.72 and $47.32.
The ETF has a beta of 1.03 and standard deviation of 16.70% for the trailing three-year period, making it a medium risk choice in the space. With about 83 holdings, it effectively diversifies company-specific risk.
Alternatives
SPDR Portfolio S&P 500 High Dividend ETF holds a Zacks ETF Rank of 1 (Strong Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, SPYD 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 $68.03 billion in assets, Vanguard Value ETF has $134.28 billion. SCHD has an expense ratio of 0.06% and VTV charges 0.04%.
Bottom-Line
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds 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 SPDR Portfolio S&P 500 High Dividend ETF (SPYD) Be on Your Investing Radar?
The SPDR Portfolio S&P 500 High Dividend ETF (SPYD - Free Report) was launched on 10/21/2015, and is a passively managed exchange traded fund designed to offer broad exposure to the Large Cap Value segment of the US equity market.
The fund is sponsored by State Street Global Advisors. It has amassed assets over $6.78 billion, making it one of the larger ETFs attempting to match the Large Cap Value segment of the US equity market.
Why Large Cap Value
Companies that fall in the large cap category tend to 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.
Value stocks are known for their lower than average price-to-earnings and price-to-book ratios, but investors should also note their lower than average sales and earnings growth rates. Looking at their long-term performance, value stocks have outperformed growth stocks in almost all markets. They are however likely to underperform growth stocks in strong bull markets.
Costs
When considering an ETF's total return, expense ratios are an important factor, and cheaper funds can significantly outperform their more expensive counterparts in the long term if all other factors remain equal.
Annual operating expenses for this ETF are 0.07%, making it one of the least expensive products in the space.
It has a 12-month trailing dividend yield of 4.26%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Real Estate sector--about 22.90% of the portfolio. Financials and Utilities round out the top three.
Looking at individual holdings, Kellanova (K - Free Report) accounts for about 1.72% of total assets, followed by Entergy Corp (ETR - Free Report) and Kinder Morgan Inc (KMI - Free Report) .
The top 10 holdings account for about 15.43% of total assets under management.
Performance and Risk
SPYD seeks to match the performance of the S&P 500 High Dividend Index before fees and expenses. The S&P 500 High Dividend Index is designed to measure the performance of the top 80 dividend-paying securities listed on the S&P 500 Index, based on dividend yield.
The ETF has added roughly 1.20% so far this year and it's up approximately 18.23% in the last one year (as of 01/24/2025). In the past 52-week period, it has traded between $37.72 and $47.32.
The ETF has a beta of 1.03 and standard deviation of 16.70% for the trailing three-year period, making it a medium risk choice in the space. With about 83 holdings, it effectively diversifies company-specific risk.
Alternatives
SPDR Portfolio S&P 500 High Dividend ETF holds a Zacks ETF Rank of 1 (Strong Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, SPYD 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 $68.03 billion in assets, Vanguard Value ETF has $134.28 billion. SCHD has an expense ratio of 0.06% and VTV charges 0.04%.
Bottom-Line
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds 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.