VIGI allocates 15.5% of its weight to Switzerland with Canada and Japan combining for almost a quarter of the fund’s weight. India and France combine for just over 18%. Emerging markets represent 22.5% of VIGI’s portfolio.
“Many foreign stocks tie their dividend payments to earnings,” said Morningstar in a recent note. “Therefore, companies that have a history of increasing their dividend payments are also likely to be those that have been consistently growing profitably. This fund’s return on invested capital comes in at 17.3%, compared with 12.5% for the MSCI ACWI ex-USA Growth Index. It also lands in the top quintile of the foreign large-growth Morningstar Category.”
VIGI yields 1.9%, indicating this is more of a dividend growth or quality play than it is a high-yield fund. The ETF is up about 22% year-to-date.
VIGI charges 0.25% per year, or $25 on a $10,000 investment, making cheaper than 76% of competing strategies, according to issuer data.
For more on smart beta ETFs, visit our Smart Beta Channel.