The consumer discretionary and utilities sectors combine for over 47% of RDIV’s weight while the energy and real estate sectors combine for another 31.3%. The ETF is significantly underweight financial services, healthcare and technology stocks relative to the S&P 900 Index.
Rising interest rates are often viewed as a risk to dividend stocks and the related exchange traded funds. However, some dividend ETFs can help income investors stick with dividend-paying stocks even as the Federal Reserves continues boosting borrowing costs.
Although RDIV has exposure to some high-yield sectors, the ETF is also chock full of companies that have steadily boosted payouts, many with lengthy histories of dividend increases.
For more on smart beta ETFs, visit our Smart Beta Channel.