By focusing on companies with strong fundamental factors, the high-dividend ETF strategy may allow investors to capture yield-generating opportunities and limit exposure to more quality companies that are better capable of sustaining the high dividend payouts.
“It’s a new strategy for yield-starved investors seeking more consistent capital growth with lower volatility and less risk from the guys who wrote the book on dividend investing,” according to WBI Shares.
Due to its indexing methodology and focus on valuation criterias, WBIY is trading at a relatively cheap 11.83 price-to-earnings ratio, compared to the S&P 500’s 18.51 P/E.
The high-yield dividend ETF tilts toward big companies, including:
- 22.8% mega-caps
- 40.0% large-caps
- 24.6% mid-caps.
Top sector weights include:
- consumer cyclical 27.5%
- utilities 17.2%
- tech 10.3%
- telecom services 9.8%
- basic materials 7.2%.
Top holdings include AT&T 5.1%, Ford Motor 5.0%, AbbVie 5.0%, LyondellBasell Industries 4.9% and Valero Energy 4.9%.
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