We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Is Invesco Dow Jones Industrial Average Dividend ETF (DJD) a Strong ETF Right Now?
Read MoreHide Full Article
A smart beta exchange traded fund, the Invesco Dow Jones Industrial Average Dividend ETF (DJD - Free Report) debuted on 12/16/2015, and offers broad exposure to the Style Box - Large Cap Blend category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
Because market cap weighted indexes provide a low-cost, convenient, and transparent way of replicating market returns, they work well for investors who believe in market efficiency.
However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.
Based on specific fundamental characteristics, or a combination of such, these indexes attempt to pick stocks that have a better chance of risk-return performance.
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
Because the fund has amassed over $338.46 million, this makes it one of the average sized ETFs in the Style Box - Large Cap Blend. DJD is managed by Invesco. This particular fund seeks to match the performance of the Dow Jones Industrial Average Yield Weighted index before fees and expenses.
The Dow Jones Industrial Average Yield Weighted Index provides exposure to high-yielding equity securities in the Dow Jones Industrial Average by their 12-month dividend yield over the prior 12 months.
Cost & Other Expenses
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive cousins if all other fundamentals are the same.
Operating expenses on an annual basis are 0.07% for DJD, making it one of the least expensive products in the space.
DJD's 12-month trailing dividend yield is 2.16%.
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.
For DJD, it has heaviest allocation in the Information Technology sector --about 16.40% of the portfolio --while Financials and Healthcare round out the top three.
Taking into account individual holdings, Verizon Communications Inc (VZ - Free Report) accounts for about 10.53% of the fund's total assets, followed by Chevron Corp (CVX - Free Report) and Cisco Systems Inc (CSCO - Free Report) .
Its top 10 holdings account for approximately 59.15% of DJD's total assets under management.
Performance and Risk
The ETF has added about 4.50% so far this year and is up about 14.78% in the last one year (as of 03/18/2025). In the past 52-week period, it has traded between $46 and $54.48.
The ETF has a beta of 0.81 and standard deviation of 13.59% for the trailing three-year period. With about 28 holdings, it has more concentrated exposure than peers.
Alternatives
Invesco Dow Jones Industrial Average Dividend ETF is a reasonable option for investors seeking to outperform the Style Box - Large Cap Blend segment of the market. However, there are other ETFs in the space which investors could consider.
Vanguard S&P 500 ETF (VOO - Free Report) tracks S&P 500 Index and the SPDR S&P 500 ETF (SPY - Free Report) tracks S&P 500 Index. Vanguard S&P 500 ETF has $595.62 billion in assets, SPDR S&P 500 ETF has $611.13 billion. VOO has an expense ratio of 0.03% and SPY charges 0.09%.
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 - Large Cap Blend.
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.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Is Invesco Dow Jones Industrial Average Dividend ETF (DJD) a Strong ETF Right Now?
A smart beta exchange traded fund, the Invesco Dow Jones Industrial Average Dividend ETF (DJD - Free Report) debuted on 12/16/2015, and offers broad exposure to the Style Box - Large Cap Blend category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
Because market cap weighted indexes provide a low-cost, convenient, and transparent way of replicating market returns, they work well for investors who believe in market efficiency.
However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.
Based on specific fundamental characteristics, or a combination of such, these indexes attempt to pick stocks that have a better chance of risk-return performance.
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
Because the fund has amassed over $338.46 million, this makes it one of the average sized ETFs in the Style Box - Large Cap Blend. DJD is managed by Invesco. This particular fund seeks to match the performance of the Dow Jones Industrial Average Yield Weighted index before fees and expenses.
The Dow Jones Industrial Average Yield Weighted Index provides exposure to high-yielding equity securities in the Dow Jones Industrial Average by their 12-month dividend yield over the prior 12 months.
Cost & Other Expenses
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive cousins if all other fundamentals are the same.
Operating expenses on an annual basis are 0.07% for DJD, making it one of the least expensive products in the space.
DJD's 12-month trailing dividend yield is 2.16%.
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.
For DJD, it has heaviest allocation in the Information Technology sector --about 16.40% of the portfolio --while Financials and Healthcare round out the top three.
Taking into account individual holdings, Verizon Communications Inc (VZ - Free Report) accounts for about 10.53% of the fund's total assets, followed by Chevron Corp (CVX - Free Report) and Cisco Systems Inc (CSCO - Free Report) .
Its top 10 holdings account for approximately 59.15% of DJD's total assets under management.
Performance and Risk
The ETF has added about 4.50% so far this year and is up about 14.78% in the last one year (as of 03/18/2025). In the past 52-week period, it has traded between $46 and $54.48.
The ETF has a beta of 0.81 and standard deviation of 13.59% for the trailing three-year period. With about 28 holdings, it has more concentrated exposure than peers.
Alternatives
Invesco Dow Jones Industrial Average Dividend ETF is a reasonable option for investors seeking to outperform the Style Box - Large Cap Blend segment of the market. However, there are other ETFs in the space which investors could consider.
Vanguard S&P 500 ETF (VOO - Free Report) tracks S&P 500 Index and the SPDR S&P 500 ETF (SPY - Free Report) tracks S&P 500 Index. Vanguard S&P 500 ETF has $595.62 billion in assets, SPDR S&P 500 ETF has $611.13 billion. VOO has an expense ratio of 0.03% and SPY charges 0.09%.
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 - Large Cap Blend.
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.