We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
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.
The Zacks Analyst Blog Highlights: VIG, SDY, DVY, SCHD and DGRO
Read MoreHide Full Article
For Immediate Release
Chicago, IL – May 26, 2020 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: (VIG - Free Report) , (SDY - Free Report) , (DVY - Free Report) , (SCHD - Free Report) and (DGRO - Free Report) .
Here are highlights from Friday’s Analyst Blog:
A Quick Guide to Dividend Aristocrat ETFs
In a near-zero interest environment and amid a series of drastic dividend cuts, investors are seeking consistent and safe income, thereby driving the appeal for dividend investing. Additionally, volatility and market uncertainty led investors flock to dividend products.
Dividend-focused products offer both safety in the form of payouts and stability in the form of mature companies that are less volatile to the large swings in stock prices. The dividend-paying securities are major sources of consistent income for investors when returns from equity markets are at risk. Further, these products are proven outperformers over the long term (read: Here's Why Dividend Growth ETFs Make a Smarter Pick Now).
While there are plenty of options in the dividend ETF world, honing in on the dividend aristocrats could be the most beneficial way in the current market environment.
Why Dividend Aristocrats?
Dividend aristocrats are the blue-chip dividend-paying companies with a long history of raising dividend payments year over year. These generally act as a hedge against economic uncertainty and provide downside protection by offering outsized payouts or sizable yields on a regular basis. Additionally, aristocrats tend to skew the portfolio to less-volatile sectors and mature companies.
Investors should note that the dividend aristocrat funds offer more dividend growth opportunities when compared to the other products in the space but might not necessarily have the highest yields. Further, these products lead to a healthy portfolio with a greater scope of capital appreciation as opposed to the simple dividend paying stocks or those with high yields.
As a result, these products provide a nice combination of annual dividend growth and capital appreciation opportunity, and are mainly suitable for risk adverse long-term investors. For them, we have highlighted some popular ETFs that could be excellent choices:
Vanguard Dividend Appreciation ETF
This is the largest and most-popular ETF in the dividend space with AUM of $41.1 billion. The fund follows the NASDAQ US Dividend Achievers Select Index, which is composed of high-quality stocks that have a record of raising dividend every year. It holds 188 securities in the basket with none accounting for more than 5.9% share. The fund charges 8 bps in annual fees and has a Zacks ETF Rank #2 (Buy) with a Medium risk outlook (read: Is Fear for Dividend Cuts Overblown? ETFs to Benefit).
SPDR S&P Dividend ETF
With AUM of $14.8 billion, this fund provides well-diversified exposure to 119 U.S. stocks that have been consistently increasing their dividends every year for at least 20 years. This can be done by tracking the S&P High Yield Dividend Aristocrats Index. Each firm accounts for less than 2.5% of assets. The fund charges 35 bps in fees and has a Zacks ETF Rank #3 (Hold) with a Medium risk outlook. iShares Select Dividend ETF
This fund provides exposure to the companies with a consistent 5-year history of dividend payments. It follows the Dow Jones U.S. Select Dividend Index and holds 92 securities in its basket with each accounting for less than 3% of assets. The ETF has AUM of $12.7 billion and charges 39 bps in fees per year from investors. It has a Zacks ETF Rank #3 with a Medium risk outlook.
Schwab U.S. Dividend Equity ETF
With AUM of $11.1 billion, this product offers exposure to 97 high-dividend yielding U.S. companies that have a record of consistent dividend payments supported by fundamental strength based on financial ratios and ample liquidity. This can be easily done by tracking the Dow Jones U.S. Dividend 100 Index. The fund is well spread across components, with none holding more than 5.9% of assets. It charges 6 bps in annual fees and has a Zacks ETF Rank #3 with a Medium risk outlook (read: Guide to 10 Most Popular Dividend ETFs).
iShares Core Dividend Growth ETF
This fund provides exposure to companies having a history of consistently growing dividends by tracking the Morningstar US Dividend Growth Index. It holds 478 stocks in its basket with each accounting for less than 3.5% share. The fund has accumulated $9.2 billion in its asset base and charges 8 bps in fees per year. It has a Zacks ETF Rank #2 with a Medium risk outlook.
Want key ETF info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week. Get it free >>
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit http://www.zacks.com/performancefor information about the performance numbers displayed in this press release.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
The Zacks Analyst Blog Highlights: VIG, SDY, DVY, SCHD and DGRO
For Immediate Release
Chicago, IL – May 26, 2020 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: (VIG - Free Report) , (SDY - Free Report) , (DVY - Free Report) , (SCHD - Free Report) and (DGRO - Free Report) .
Here are highlights from Friday’s Analyst Blog:
A Quick Guide to Dividend Aristocrat ETFs
In a near-zero interest environment and amid a series of drastic dividend cuts, investors are seeking consistent and safe income, thereby driving the appeal for dividend investing. Additionally, volatility and market uncertainty led investors flock to dividend products.
Dividend-focused products offer both safety in the form of payouts and stability in the form of mature companies that are less volatile to the large swings in stock prices. The dividend-paying securities are major sources of consistent income for investors when returns from equity markets are at risk. Further, these products are proven outperformers over the long term (read: Here's Why Dividend Growth ETFs Make a Smarter Pick Now).
While there are plenty of options in the dividend ETF world, honing in on the dividend aristocrats could be the most beneficial way in the current market environment.
Why Dividend Aristocrats?
Dividend aristocrats are the blue-chip dividend-paying companies with a long history of raising dividend payments year over year. These generally act as a hedge against economic uncertainty and provide downside protection by offering outsized payouts or sizable yields on a regular basis. Additionally, aristocrats tend to skew the portfolio to less-volatile sectors and mature companies.
Investors should note that the dividend aristocrat funds offer more dividend growth opportunities when compared to the other products in the space but might not necessarily have the highest yields. Further, these products lead to a healthy portfolio with a greater scope of capital appreciation as opposed to the simple dividend paying stocks or those with high yields.
As a result, these products provide a nice combination of annual dividend growth and capital appreciation opportunity, and are mainly suitable for risk adverse long-term investors. For them, we have highlighted some popular ETFs that could be excellent choices:
Vanguard Dividend Appreciation ETF
This is the largest and most-popular ETF in the dividend space with AUM of $41.1 billion. The fund follows the NASDAQ US Dividend Achievers Select Index, which is composed of high-quality stocks that have a record of raising dividend every year. It holds 188 securities in the basket with none accounting for more than 5.9% share. The fund charges 8 bps in annual fees and has a Zacks ETF Rank #2 (Buy) with a Medium risk outlook (read: Is Fear for Dividend Cuts Overblown? ETFs to Benefit).
SPDR S&P Dividend ETF
With AUM of $14.8 billion, this fund provides well-diversified exposure to 119 U.S. stocks that have been consistently increasing their dividends every year for at least 20 years. This can be done by tracking the S&P High Yield Dividend Aristocrats Index. Each firm accounts for less than 2.5% of assets. The fund charges 35 bps in fees and has a Zacks ETF Rank #3 (Hold) with a Medium risk outlook.
iShares Select Dividend ETF
This fund provides exposure to the companies with a consistent 5-year history of dividend payments. It follows the Dow Jones U.S. Select Dividend Index and holds 92 securities in its basket with each accounting for less than 3% of assets. The ETF has AUM of $12.7 billion and charges 39 bps in fees per year from investors. It has a Zacks ETF Rank #3 with a Medium risk outlook.
Schwab U.S. Dividend Equity ETF
With AUM of $11.1 billion, this product offers exposure to 97 high-dividend yielding U.S. companies that have a record of consistent dividend payments supported by fundamental strength based on financial ratios and ample liquidity. This can be easily done by tracking the Dow Jones U.S. Dividend 100 Index. The fund is well spread across components, with none holding more than 5.9% of assets. It charges 6 bps in annual fees and has a Zacks ETF Rank #3 with a Medium risk outlook (read: Guide to 10 Most Popular Dividend ETFs).
iShares Core Dividend Growth ETF
This fund provides exposure to companies having a history of consistently growing dividends by tracking the Morningstar US Dividend Growth Index. It holds 478 stocks in its basket with each accounting for less than 3.5% share. The fund has accumulated $9.2 billion in its asset base and charges 8 bps in fees per year. It has a Zacks ETF Rank #2 with a Medium risk outlook.
Want key ETF info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week. Get it free >>
Media Contact
Zacks Investment Research
800-767-3771 ext. 9339
support@zacks.com
http://www.zacks.com
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit http://www.zacks.com/performancefor information about the performance numbers displayed in this press release.