“The result is a curious mix of quality and distress,” according to Morningstar Samuel Lee. “Quality because companies that have grown their dividends like clockwork tend to have solid earnings and sustainable business models; distress because the emphasis on the highest yielders means firms that have hit a rough patch right before the annual rebalance get big overweightings.”

SPDR S&P Dividend ETF

For more information on dividends, visit our dividend ETFs category.

Max Chen contributed to this article.

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