Not only does DLN house a collection of stocks that are viewed as paying some of the safest dividends, the WisdomTree LargeCap Dividend Index (WTLDI) “is dividend weighted annually to reflect the proportionate share of the aggregate cash dividends each component company is projected to pay in the coming year, based on the most recently declared dividend per share,” according to WisdomTree. [ETFs With Safe Dividends]
DGRW, which has grown in prominence and size this year, features one of the largest tech sector allocations among U.S. dividend ETFs at 21.4%. That includes a 4% weight to Microsoft, the ETF’s third-largest holding.
The cash on hand figures and low payout ratios of DGRW’s largest tech holdings combined with the fact that the ETF features no telecom or utilities exposure indicate the ETF’s dividends should be safe and continue growing even if interest rates rise.
Additionally, DGRW’s quality mandate is driven by an emphasis on three-year measures of return on assets and return on equity. [Dividend ETF Grows Up]
Microsoft usually raises its dividend in the third quarter. The company’s last two dividend increases were 21.7% and 15%, respectively. The dividend has more than doubled since 2010.
iShares MSCI USA Quality Factor ETF
Tom Lydon’s clients own shares of Microsoft. Todd Shriber owns shares of DGRW.