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The Global X SuperDividend U.S. ETF (DIV) made its debut on 03/11/2013, and is a smart beta exchange traded fund that provides broad exposure to the Style Box - All Cap Value category of the market.
I got quite a few notes in the mailbag last week. One that piqued my interest was from JT who asked if there are any ETFs or mutual funds that have a dividend investing philosophy similar to mine.
I maintain the Hold rating on the Global X SuperDividend U.S. ETF as I expect it to underperform the market into 2027. DIV's portfolio is heavily skewed toward small- and mid-cap value/deep value names, with a 7.6% adjusted weighted average earnings yield but very weak earnings growth. I expect the DIV portfolio's low beta, weak quality, and anemic growth characteristics to detract from returns into 2027.
That 9% yield looks like a dream until you check what happened to the principal underneath it. Some of today's most popular high-yield ETFs have a track record that should make income investors rethink what a big distribution actually costs them.
Or is there a happy medium?
A U.S. ETF built entirely around chasing the highest yields it can find sounds like an income investor's dream, but the long-term numbers tell a more complicated story about what that monthly cash actually costs you.
Rising oil prices and sticky inflation are fueling demand for income, putting high-yield dividend ETFs offering more than 5% in the spotlight.
The Global X SuperDividend U.S. ETF (NYSEARCA:DIV) hunts for the 50 highest-yielding U.S.