Looking for a dividend growth ETF? Adding a strategy that considers dividends when seeking out investment opportunities may appeal, especially amid brewing uncertainty. With so many firms facing rising debt costs should a top-heavy tech sector tumble, leaning on firms with healthy dividends may make sense. The dividend growth ETF DGRW may be one to watch, adding nearly a $250 million in net inflows over the last week alone per VettaFi.
What’s driving those flows? The WisdomTree US Quality Dividend Growth Fund (DGRW), had already added more than $2 billion over the last one year. That means that this past week’s flows have lifted that total above $2 billion on its own. What might be driving those flows? The above case for dividend growth as a view into investing amid uncertainty makes sense, but that isn’t the only factor.
See more: “How to Find the Right Dividend Growth ETF”
DGRW also charges a pretty solid fee of 28 basis points (bps). The ETF tracks an index that eyes quality as well as dividend factors on top of historical return on assets (ROA) and return on equity (ROE). Crucially, it also caps individual weights at 5% and sector weights at 20%, which can prevent it from being overexposed.
Digging Into a Dividend Growth ETF
The dividend growth ETF has a long track record of performance, too, which helps. Just as it recently hit its 10-year ETF milestone, the strategy can look back on outperformance over one-, three-, and five-year ranges. It has returned 18.3% over one year, specifically, outdoing its FactSet Segment average. With dividends able to be reinvested on top of offering strong information, the overall dividend case looks pretty intriguing.
Looking forward, DGRW remains very close to hitting $10 billion in AUM. Should the strategy continue to see strong flows like it has over the last week, it may yet do so.
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