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Is ProShares S&P Technology Dividend Aristocrats ETF (TDV) a Strong ETF Right Now?

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The ProShares S&P Technology Dividend Aristocrats ETF (TDV - Free Report) was launched on 11/05/2019, and is a smart beta exchange traded fund designed to offer broad exposure to the Technology ETFs category of the market.

What Are Smart Beta ETFs?

Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.

Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.

There are some investors, though, who think it's possible to beat the market with great stock selection; this group likely invests in another class of funds known as smart beta, which track non-cap weighted strategies.

This kind of index follows this same mindset, as it attempts to pick stocks that have better chances of risk-return performance; non-cap weighted strategies base selection on certain fundamental characteristics, or a mix of such characteristics.

Methodologies like equal-weighting, one of the simplest options out there, fundamental weighting, and volatility/momentum based weighting are all choices offered to investors in this space, but not all of them can deliver superior returns.

Fund Sponsor & Index

Because the fund has amassed over $225.78 million, this makes it one of the average sized ETFs in the Technology ETFs. TDV is managed by Proshares. TDV, before fees and expenses, seeks to match the performance of the S&P TECHNOLOGY DIVIDEND ARISTOCRATS INDX.

The S&P Technology Dividend Aristocrats Index targets companies from information technology, internet and direct marketing retail, interactive home entertainment, and interactive media and services segments of the economy.

Cost & Other Expenses

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 TDV are 0.45%, which makes it on par with most peer products in the space.

It has a 12-month trailing dividend yield of 1.23%.

Sector Exposure and Top Holdings

Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.

For TDV, it has heaviest allocation in the Information Technology sector --about 75.90% of the portfolio --while Industrials and Financials round out the top three.

Looking at individual holdings, Csg Systems Intl Inc (CSGS - Free Report) accounts for about 3.20% of total assets, followed by Intl Business Machines Corp (IBM - Free Report) and Genpact Ltd (G - Free Report) .

TDV's top 10 holdings account for about 27.61% of its total assets under management.

Performance and Risk

Year-to-date, the ProShares S&P Technology Dividend Aristocrats ETF has lost about -4% so far, and was up about 7.76% over the last 12 months (as of 05/02/2025). TDV has traded between $62.35 and $80.69 in this past 52-week period.

The fund has a beta of 1.06 and standard deviation of 21.53% for the trailing three-year period. With about 39 holdings, it has more concentrated exposure than peers.

Alternatives

ProShares S&P Technology Dividend Aristocrats ETF is an excellent option for investors seeking to outperform the Technology ETFs segment of the market. There are other ETFs in the space which investors could consider as well.

IShares Core Dividend Growth ETF (DGRO - Free Report) tracks Morningstar US Dividend Growth Index and the Vanguard Dividend Appreciation ETF (VIG - Free Report) tracks NASDAQ US Dividend Achievers Select Index. IShares Core Dividend Growth ETF has $30.08 billion in assets, Vanguard Dividend Appreciation ETF has $85.30 billion. DGRO has an expense ratio of 0.08% and VIG charges 0.05%.

Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Technology ETFs.

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.

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