REGL tries to reflect the performance of the S&P MidCap 400 Dividend Aristocrats Index, which includes mid-sized companies that have increased dividends for at least 15 consecutive years and is equally weighted so performance is not top heavy. The ETF includes a hefty 24.8% tilt toward the financial sector, along with 20.0% in utilities and 17.8% industrials. REGL has a 2.15% 30-day SEC yield.
SMDV tracks the Russell 2000 Dividend Growth Index, which includes small-cap companies with at least 10 consecutive years of dividend growth and is equally weighted as well. The ETF leans towards utilities at 30.6% of the fund’s portfolio, along with financials 19.4% and industrials 19.1%. SMDV shows a 2.23% 30-day SEC yield.
The dividend growth strategy has helped the ETFs generate better risk-adjusted returns than the traditional small- and mid-cap benchmarks. Since its inception, SMDV has gained 2.21%, compared to the Russell 2000’s 12.3% decline, and traded at a better standard deviation or lower volatility. Additionally, REGL fell 3.3% since inception, compared to the S&P MidCap 400’s 9.2% pullback, and showed a lower volatility as well.
Max Chen contributed to this article.