A Decadent Defensive Dividend ETF


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A volatile start to the year for equities has investors craving safe-haven assets. In past periods of volatility, safe-haven assets have included dividend stocks and exchange traded funds, but with S&P 500 dividend slowing, some income investors are giving dividends the cold shoulder.

 

The WisdomTree High Dividend Fund (NYSE: DHS) is one way for investors to maintain dividend exposure while playing defense. DHS's underlying index, the WisdomTree High Dividend Index (WTHYE) “is dividend weighted annually to reflect the proportionate share of the aggregate cash dividends each component company is projected to pay in the coming year, based on the most recently declared dividend per share,” according to WisdomTree.

 

 


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We screened all the WisdomTree equity Funds in search of what has been our most defensive equity Fund thus far in 2016. The answer: the WisdomTree High Dividend Fund (DHS). The Index it tracks, the WisdomTree High Dividend Index, declined just 3.2% through February 15 at a time when the S&P 500 Index had declined by 8.5%. The WisdomTree High Dividend Index is exhibiting three characteristics that investors typically search for in choppy markets: defensive sector exposure, lower beta and a healthy dividend yield,” said WisdomTree Chie

 

 

 

 

By selecting stocks based on high dividend yields and then weighting them based on the dollar value of regular cash dividends paid to shareholders, the WisdomTree High Dividend Index typically exhibits a value tilt. However, by focusing on dividends in the selection and weighting process—unlike some market cap-weighted value indexes—this strategy typically generates a higher starting dividend yield and greater overall exposure to the 'defensive sectors' of the market,” adds Siracusano.


Crypto Whales Are Loading Up — Are You?

New research shows the biggest crypto buyers are back. And this time? They could hold for the possibility that Bitcoin will surpass $100,000 in 2024. You don’t want to miss the next massive crypto bull run like we saw in 2020 and 2021. To know exactly what’s going on and what to buy… Get Access To Benzinga’s Best Crypto Research and Investments For Only $1.


Posted In: Long IdeasNewsBroad U.S. Equity ETFsDividendsDividendsIntraday UpdateMarketsTrading IdeasETFs