“The ETF launched in May 2013 and has $220 million in assets. SYLD is an actively managed ETF that employs a quantitative approach to select U.S. listed companies that show strong characteristics in returning free cash flow to their shareholders. Specifically, SYLD invests in 100 stocks with market caps greater than $200 million that rank among the highest in paying cash dividends; engaging in net share repurchases; and paying down debt on their balance sheets,” said S&P Capital IQ.
By emphasizing the cash component and an equal-weight methodology, which can reduce volatility, SYLD is not saddled with large exposure to prolific share repurchasers that are either using those buybacks to manage earnings expectations, funding those buybacks with new debt or merely using buybacks as a way of dealing with employee stock awards. [IBM Isn’t a Big Deal in Buyback ETFs]
The ETF’s holdings include Apple (NasdaqGS: AAPL), CVS (NYSE: CVS) and Western Digital (NYSE: WDC). SYLD is also rated marketweight by S&P Capital IQ.
Cambria Shareholder Yield ETF
Tom Lydon’s clients own shares of Apple and DVY.