The final domestic dividend-based exchange-traded fund (ETFs) I want to feature for you in my current series is First Trust Value Line Dividend ETF (FVD).
Roughly 90% of FVD’s total of $2.3 billion assets are invested in common stocks that comprise the Value Line Dividend Index. That index, in turn, is comprised of U.S. companies that pay above-average dividends and have a good outlook for capital appreciation.
FVD has had a return of 15.02% during the past 12 months, handily topping the S&P 500 Index’s rise of -0.22%. So far in July, FVD has gained 3.10% and the month still has another trading day left. FVD’s strong overall uptrend for the year can be seen in the graph below. The fund has a dividend yield of 2.10% and its expense ratio is 0.7%.
FVD holds a total of 192 positions. Each holding only contributes to a fraction of the total portfolio weight, making the overall portfolio very diversified. Its top five holdings are Linear Technology Corp. (LLTC), 0.64%; Garmin Ltd (GRMN), 0.59%; Texas Instruments Inc. (TXN), 0.56%; Caterpillar Inc. (CAT), 0.56%; and Apple Inc. (APPL), 0.55%.
Diversification reduces risk, which is a strong plus in today’s uncertain markets. Plus, 22.64% of the fund is in the utilities sector, which is a defensive sector that limits the fund’s risk from market disruptions.
If you are seeking a diversified and somewhat low-risk fund that’s had strong returns in the past year that have continued unabated, consider looking into First Trust Value Line DVD (FVD).
As always, I am happy to answer any of your questions about ETFs, so do not hesitate to send me an email. You just may see your question answered in a future ETF Talk.