The ProShares fund devotes almost 24% of its weight to small-cap utilities while the financial services and industrial sectors combine for over 35% of the ETF’s roster.
Dividend growth rather than high yield can be a potent, less risky long-term income strategy. Company stocks that issue high dividend yields can be masking their distressed books or may not be sustainable and are heading for dividend cuts. Consequently, these quality dividend ETFs try to limit the impact of these value traps by requiring a history of sustainable dividend growth.
For more on core investing strategies, please visit our Core ETF Channel.