Many investors want dividends but don’t want to make a style bet on value.
Particularly in down or choppy markets, investors can boost total returns by investing in dividend stocks. Additionally, companies paying steady, attractive dividends are largely seen as more stable securities. The companies paying dividends are often mature firms that have mastered their business, made the essential investments, and now generate more money than they have a meaningful use for.
The downside for investors, however, is most dividend ETFs with attractive yields also tilt heavily toward value stocks. While dividend ETFs promise attractive income, most also require investors make a style bet on value.
For investors who want a style pure core ETF that offers an attractive yield, the Hartford Disciplined US Equity ETF (HDUS) may be a compelling solution.
See more: “The Different Use Cases for U.S. Equity Funds ROUS and HDUS”
Under the Hood of HDUS
Hartford Funds’ style pure core ETF typically yields 30% above the S&P 500 while avoiding a heavy value tilt like many funds with attractive yields.
HDUS’s underlying index had a dividend yield of 2.05% as of June 30. In comparison, the Russell 1000 was yielding 1.50% at the end of June and the S&P 500 is currently yielding 1.55%.
HDUS leverages a rules-based process that seeks to target balanced and consistent exposure over time across multiple risk factors for return enhancement potential. The fund simultaneously controls for active risk and volatility level.
The fund was launched in November 2022 and has accreted $91 million in assets under management. HDUS charges 19 basis points.
See more: “Cap-Weighted ETFs Can Introduce Unintended Risks to Portfolios”
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This article was prepared as part of Hartford Funds paid sponsorship with VettaFi. Hartford Funds is not affiliated with VettaFi and was not involved in drafting this article. The opinions and forecasts expressed are solely those of VettaFi. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, a recommendation for any product or as investment advice.