Mebane Faber’s Cambria Funds introduces the Cambria Foreign Shareholder Yield ETF (NYSEArca: FYLD) today. The new ETF appears to be the global equivalent of the newly minted, but already successful Cambria Shareholder Yield ETF (NYSEArca: SYLD).
With an annual expense ratio of 0.59%, FYLD will track the Cambria Foreign Shareholder Yield Index. FYLD will be passively managed and its underlying index considers Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Greece, Hong Kong, Ireland, Israel, Italy, Japan, Luxembourg, the Netherlands, New Zealand, Norway, Portugal, Singapore, South Korea, Spain, Sweden, Switzerland, and the United Kingdom to be developed markets.
To be included in the new ETF, companies must not only pay dividends, but also repurchase shares will sporting strong cash positions and low debt burdens, according to a filing with the Securities and Exchange Commission.
“Each of these characteristics will be measured on a one-month to 12-month basis by the Underlying Index methodology, and no single measurement will be dispositive. Pursuant to the methodology of the Underlying Index, the 100 issuers that have exhibited, in the aggregate, the strongest cash flows, the highest dividends paid to shareholders, and net stock buybacks and debt paydown will included in the Underlying Index.
“The Underlying Index will be weighted based only on publicly available data and will include screens to limit its country, sector and industry concentration to seek to ensure its liquidity and investability,” according to the filing.
That is a similar methodology to which SYLD adheres. That ETF, which debuted in mid-May, is home to 100 dividend payers that also buyback shares and are whittling down debt. [Faber Discusses New Shareholder Yield ETF]
Actively managed, SYLD allocated a combined 51% of its weight to the consumer discretionary, financial services and technology sectors at the end of the third quarter, according to issuer data. Top-10 holdings include Southwest Airlines (NYSE: LUV), GameStop (NYSE: GME) and Xerox (NYSE: XRX).
Cambria Shareholder Yield ETF
ETF Trends editorial team contributed to this post.