KXI also delivers on another feature investors love about staples stocks: Dividend growth. One of the primary reasons why stocks such as Procter & Gamble and Pepsi remain popular with investors is the dependable, annual dividend increases. Those growing dividends have helped KXI’s payout grow to over $2 a share last year from about $1.25 a share in 2009.
However, there is an important element to KXI’s story that cannot go overlooked and that is currency risk. If the U.S. dollar strengthens, over half of the ETF’s holding would be vulnerable. On the other hand, a strong euro, Swiss franc and British pound could be problematic for the ETF, though not to the degree that a strong greenback would be.
iShares S&P Global Consumer Staples Sector Index Fund
ETF Trends editorial team contributed to this post.