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Is Franklin U.S. Low Volatility High Dividend Index ETF (LVHD) a Strong ETF Right Now?
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Making its debut on 12/28/2015, smart beta exchange traded fund Franklin U.S. Low Volatility High Dividend Index ETF (LVHD - Free Report) provides investors broad exposure to the Style Box - Large Cap Value category of the market.
What Are Smart Beta ETFs?
For a long time now, the ETF industry has been flooded with products based on market capitalization weighted indexes, which are designed to represent the broader market or a particular market segment.
A good option for investors who believe in market efficiency, market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns.
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.
By attempting to pick stocks that have a better chance of risk-return performance, non-cap weighted indexes are based on certain fundamental characteristics, or a combination of such.
The smart beta space gives investors many different choices, from equal-weighting, one of the simplest strategies, to more complicated ones like fundamental and volatility/momentum based weighting. However, not all of these methodologies have been able to deliver remarkable returns.
Fund Sponsor & Index
Managed by Franklin Templeton Investments, LVHD has amassed assets over $566.29 million, making it one of the average sized ETFs in the Style Box - Large Cap Value. LVHD, before fees and expenses, seeks to match the performance of the QS Low Volatility High Dividend Index.
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.
Cost & Other Expenses
Expense ratios are an important factor in the return of an ETF and in the long-term, cheaper funds can significantly outperform their more expensive cousins, other things remaining the same.
Annual operating expenses for LVHD are 0.27%, which makes it on par with most peer products in the space.
The fund has a 12-month trailing dividend yield of 3.52%.
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 LVHD, it has heaviest allocation in the Consumer Staples sector --about 24.60% of the portfolio --while Utilities and Real Estate round out the top three.
Taking into account individual holdings, Altria Group Inc (MO - Free Report) accounts for about 2.56% of the fund's total assets, followed by Lockheed Martin Corp (LMT - Free Report) and Verizon Communications Inc (VZ - Free Report) .
The top 10 holdings account for about 24.91% of total assets under management.
Performance and Risk
So far this year, LVHD has added roughly 4.62%, and is up about 14.95% in the last one year (as of 06/10/2025). During this past 52-week period, the fund has traded between $35.48 and $41.26.
The ETF has a beta of 0.67 and standard deviation of 13.71% for the trailing three-year period. With about 121 holdings, it effectively diversifies company-specific risk.
Alternatives
Franklin U.S. Low Volatility High Dividend Index ETF is a reasonable option for investors seeking to outperform the Style Box - Large Cap Value segment of the market. However, there are other ETFs in the space which investors could consider.
Schwab U.S. Dividend Equity ETF (SCHD - Free Report) tracks Dow Jones U.S. Dividend 100 Index and the Vanguard Value ETF (VTV - Free Report) tracks CRSP U.S. Large Cap Value Index. Schwab U.S. Dividend Equity ETF has $69.43 billion in assets, Vanguard Value ETF has $134.85 billion. SCHD has an expense ratio of 0.06% and VTV charges 0.04%.
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 Value.
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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Is Franklin U.S. Low Volatility High Dividend Index ETF (LVHD) a Strong ETF Right Now?
Making its debut on 12/28/2015, smart beta exchange traded fund Franklin U.S. Low Volatility High Dividend Index ETF (LVHD - Free Report) provides investors broad exposure to the Style Box - Large Cap Value category of the market.
What Are Smart Beta ETFs?
For a long time now, the ETF industry has been flooded with products based on market capitalization weighted indexes, which are designed to represent the broader market or a particular market segment.
A good option for investors who believe in market efficiency, market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns.
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.
By attempting to pick stocks that have a better chance of risk-return performance, non-cap weighted indexes are based on certain fundamental characteristics, or a combination of such.
The smart beta space gives investors many different choices, from equal-weighting, one of the simplest strategies, to more complicated ones like fundamental and volatility/momentum based weighting. However, not all of these methodologies have been able to deliver remarkable returns.
Fund Sponsor & Index
Managed by Franklin Templeton Investments, LVHD has amassed assets over $566.29 million, making it one of the average sized ETFs in the Style Box - Large Cap Value. LVHD, before fees and expenses, seeks to match the performance of the QS Low Volatility High Dividend Index.
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.
Cost & Other Expenses
Expense ratios are an important factor in the return of an ETF and in the long-term, cheaper funds can significantly outperform their more expensive cousins, other things remaining the same.
Annual operating expenses for LVHD are 0.27%, which makes it on par with most peer products in the space.
The fund has a 12-month trailing dividend yield of 3.52%.
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 LVHD, it has heaviest allocation in the Consumer Staples sector --about 24.60% of the portfolio --while Utilities and Real Estate round out the top three.
Taking into account individual holdings, Altria Group Inc (MO - Free Report) accounts for about 2.56% of the fund's total assets, followed by Lockheed Martin Corp (LMT - Free Report) and Verizon Communications Inc (VZ - Free Report) .
The top 10 holdings account for about 24.91% of total assets under management.
Performance and Risk
So far this year, LVHD has added roughly 4.62%, and is up about 14.95% in the last one year (as of 06/10/2025). During this past 52-week period, the fund has traded between $35.48 and $41.26.
The ETF has a beta of 0.67 and standard deviation of 13.71% for the trailing three-year period. With about 121 holdings, it effectively diversifies company-specific risk.
Alternatives
Franklin U.S. Low Volatility High Dividend Index ETF is a reasonable option for investors seeking to outperform the Style Box - Large Cap Value segment of the market. However, there are other ETFs in the space which investors could consider.
Schwab U.S. Dividend Equity ETF (SCHD - Free Report) tracks Dow Jones U.S. Dividend 100 Index and the Vanguard Value ETF (VTV - Free Report) tracks CRSP U.S. Large Cap Value Index. Schwab U.S. Dividend Equity ETF has $69.43 billion in assets, Vanguard Value ETF has $134.85 billion. SCHD has an expense ratio of 0.06% and VTV charges 0.04%.
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 Value.
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.