Second, developed market dividend payers often sport higher yields than their U.S. counterparts in the same sectors, an important consideration for income investors at a time when Treasury yields are well above the yields on U.S. dividend ETFs. IQDF has a 30-day SEC yield of 5.15% and a weighted average dividend yield of 5.22%. Both numbers imply a yield that is at least 240 basis points above the current 10-year Treasury yield.
At the country level, IQDF is similar to established ETFs that focus on developed markets in Europe, Australia, Asia and the Far East (EAFE) as the U.K., Japan and Australia combine for about 37.6% of the fund’s weight. However, IQDF does offer some leverage to a continued rebound in Eurozone equity markets as the region’s four largest economies – Germany, France, Italy and Spain – are all found among the ETF’s top-10 country weights.
IQDF is not an explicit large-cap ETF. Large-caps account for 55% of the funds weight, but mid-caps occupy a solid 33.4% presence. The new ETF charges 0.47% per year, which is competitive with more established international dividend ETFs.
FlexShares International Quality Dividend Index Fund
ETF Trends editorial team contributed to this post.