“We think it is incredibly important to look beyond market capitalization and focus on fundamental metrics such as revenue when building an efficient portfolio,” according to an OppenheimerFunds research note. “Our revenue-weighting methodology can help investors look through the noise of short-term price movements and focus on the long-term fundamentals that matter. Because of this, we continue to believe that the Fund will provide an opportunity to outperform over the long term while offering excellent dividend yield.”
By rebalancing toward companies with persistent sales, revenue weighting helps keep a portfolio from overstaying during an overheating market. The result could be a portfolio with better risk-adjusted returns over the long haul.
“Revenue weighting is based on a reliable, tangible indicator of a company’s success,” according to OppenheimerFunds.
RDIV is heavy on dividend-paying consumer discretionary names at 30.3% of the portfolio, followed by utilities 21.9%, telecom services 15.4%, energy 13.1% and real estate 10.7%. Top holdings include Duke Energy 5.6%, Target Corp. 5.4%, Verizon Communications 4.9%, Southern Co. 4.8% and AT&T 4.8%.
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