For example, the Morningstar US Dividend Growth Index does not include companies with yields that rank in the top 10% of the eligible inclusion universe and only companies with a payout ratio of less than 75% can be included, according to Morningstar.
DGRO’s top-10 holdings include an array of companies with multi-decade dividend increase streaks, including Dow components Exxon Mobil (NYSE: XOM), Johnson & Johnson (NYSE: JNJ) and Wal-Mart (NYSE: WMT). [ETF Targets Dividend Consistency]
Investors that “believe that U.S. economic growth is poised to improve in late 2014 and into 2015, and are concerned that interest rates will move higher, iShares Core Dividend Growth ETF might make more sense. Despite its young age and lower yield, it has greater exposure to sectors and stocks that can benefit more an improving economic cycle,” said S&P Capital IQ.
iShares Core Dividend Growth ETF
ETF Trends editorial team contributed to this post.