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Should You Invest in the Invesco KBW High Dividend Yield Financial ETF (KBWD)?
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Designed to provide broad exposure to the Financials - Broad segment of the equity market, the Invesco KBW High Dividend Yield Financial ETF (KBWD - Free Report) is a passively managed exchange traded fund launched on December 2, 2010.
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.
Additionally, sector ETFs offer convenient ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Financials - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 5, placing it in top 31%.
Index Details
The fund is sponsored by Invesco. It has amassed assets over $417.55 million, making it one of the average sized ETFs attempting to match the performance of the Financials - Broad segment of the equity market. KBWD seeks to match the performance of the KBW Nasdaq Financial Sector Dividend Yield Index before fees and expenses.
The KBW Nasdaq Financial Sector Dividend Yield Index is a dividend yield weighted index seeking to reflect the performance of approximately 24 to 40 publicly listed financial companies engaged in the business of providing financial services and products, including banking, insurance and diversified financial services, in the US.
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 2.02%, making it one of the most expensive products in the space.
It has a 12-month trailing dividend yield of 12.86%.
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.
This ETF has heaviest allocation in the Financials sector -- about 100% of the portfolio.
Looking at individual holdings, Orchid Island Capital Inc (ORC) accounts for about 4.65% of total assets, followed by Invesco Mortgage Capital Inc (IVR) and Agnc Investment Corp (AGNC).
The top 10 holdings account for about 37.12% of total assets under management.
Performance and Risk
The ETF has added roughly 1.64% so far this year and is up roughly 1.65% in the last one year (as of 10/15/2025). In that past 52-week period, it has traded between $12.37 and $15.69.
The ETF has a beta of 1.15 and standard deviation of 19.52% for the trailing three-year period, making it a medium risk choice in the space. With about 42 holdings, it has more concentrated exposure than peers.
Alternatives
Invesco KBW High Dividend Yield Financial ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, KBWD is a sufficient option for those seeking exposure to the Financials ETFs area of the market. Investors might also want to consider some other ETF options in the space.
Vanguard Financials ETF (VFH) tracks MSCI US Investable Market Financials 25/50 Index and the Financial Select Sector SPDR ETF (XLF) tracks Financial Select Sector Index. Vanguard Financials ETF has $13.00 billion in assets, Financial Select Sector SPDR ETF has $53.04 billion. VFH has an expense ratio of 0.09%, and XLF charges 0.08%.
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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Should You Invest in the Invesco KBW High Dividend Yield Financial ETF (KBWD)?
Designed to provide broad exposure to the Financials - Broad segment of the equity market, the Invesco KBW High Dividend Yield Financial ETF (KBWD - Free Report) is a passively managed exchange traded fund launched on December 2, 2010.
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.
Additionally, sector ETFs offer convenient ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Financials - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 5, placing it in top 31%.
Index Details
The fund is sponsored by Invesco. It has amassed assets over $417.55 million, making it one of the average sized ETFs attempting to match the performance of the Financials - Broad segment of the equity market. KBWD seeks to match the performance of the KBW Nasdaq Financial Sector Dividend Yield Index before fees and expenses.
The KBW Nasdaq Financial Sector Dividend Yield Index is a dividend yield weighted index seeking to reflect the performance of approximately 24 to 40 publicly listed financial companies engaged in the business of providing financial services and products, including banking, insurance and diversified financial services, in the US.
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 2.02%, making it one of the most expensive products in the space.
It has a 12-month trailing dividend yield of 12.86%.
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.
This ETF has heaviest allocation in the Financials sector -- about 100% of the portfolio.
Looking at individual holdings, Orchid Island Capital Inc (ORC) accounts for about 4.65% of total assets, followed by Invesco Mortgage Capital Inc (IVR) and Agnc Investment Corp (AGNC).The top 10 holdings account for about 37.12% of total assets under management.
Performance and Risk
The ETF has added roughly 1.64% so far this year and is up roughly 1.65% in the last one year (as of 10/15/2025). In that past 52-week period, it has traded between $12.37 and $15.69.
The ETF has a beta of 1.15 and standard deviation of 19.52% for the trailing three-year period, making it a medium risk choice in the space. With about 42 holdings, it has more concentrated exposure than peers.
Alternatives
Invesco KBW High Dividend Yield Financial ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, KBWD is a sufficient option for those seeking exposure to the Financials ETFs area of the market. Investors might also want to consider some other ETF options in the space.
Vanguard Financials ETF (VFH) tracks MSCI US Investable Market Financials 25/50 Index and the Financial Select Sector SPDR ETF (XLF) tracks Financial Select Sector Index. Vanguard Financials ETF has $13.00 billion in assets, Financial Select Sector SPDR ETF has $53.04 billion. VFH has an expense ratio of 0.09%, and XLF charges 0.08%.
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.