Dividend exchange traded funds that target quality dividend growth names have resonated with income-minded investors as more look for reliable opportunities to enhance their portfolios.
“We take particular pride in this new strategic business that we’ve set up,” Steve Cohen, Managing Director, ProShares, said at the Inside ETFs conference.
“The real highlight here is our flagship dividend growth product – NOBL, which is a product that just seems right for the times,” he added.
The ProShares S&P 500 Aristocrats ETF (NOBL), which tracks the S&P 500 Dividend Aristocrats Index, is ProShares’ flagship dividend growth ETF strategy that targets the cream of the crop, only selecting components that have increased their dividends for at least 25 consecutive years. Consequently, investors are left with a portfolio of high-quality, sustainable dividend payers as opposed to more high-yield focused funds that may contain companies in more precarious financial positions.
ProShares also offers dividend growth ETFs that focus on other market segments, like the ProShares Russell 2000 Dividend Growers ETF (SMDV) and the ProShares S&P MidCap 400 Dividend Aristocrats ETF (REGL) for those seeking quality dividend growers in the small- and mid-cap categories, respectively. The mid-cap Dividend Aristocrats Index, though, only requires 15 consecutive years of increased dividends for inclusion. SMDV, a dividend spin on the Russell 2000, the benchmark U.S. small-cap index, tracks the Russell 2000 Dividend Growth Index, which includes small-cap firms with dividend increase streaks of at least a decade.
Investors can diversify into international markets while tracking similar dividend growth strategies. For instance, the ProShares MSCI EAFE Dividend Growers ETF (EFAD) tracks developed market Europe, Australasia, and Far East companies that exhibit a minimum dividend increase streak of 10 years.
The ProShares MSCI Europe Dividend Growers ETF (EUDV) tracks the performance of the MSCI Europe Dividend Masters Index, which consists of at least 25 European companies that have consistently increased their dividends for at least ten consecutive years.
The ProShares MSCI Emerging Markets Dividend Growers ETF (EMDV) follows the MSCI Emerging Markets Dividend Masters Index, which targets MSCI Emerging Market components that have increased dividend payments each year for at least seven consecutive years.
Additionally, ProShares more recently added to its burgeoning lineup of dividend growth ETFs with the launches of two funds – the ProShares Russell U.S. Dividend Growers ETF (TMDV) and the ProShares S&P Technology Dividend Aristocrats ETF (TDV).
Watch Steven Cohen discuss Dividend Growth Opportunities:
For more ETF-related commentary from Tom Lydon and other industry experts, visit our video category.