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The fund will normally invest at least 90% of its net assets (including investment borrowings) in the common stocks that comprise the index. The index is designed to measure the performance of the 100 highest-yielding stocks that have a consistent record of dividend payment and have the ability to sustain their dividend payments. It is non-diversified.

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The FDA may approve updated COVID-19 vaccines this week to combat recent strains as the country endures a significant summer outbreak.

FDA Set To Approve COVID-19 Vaccines As Soon As This Week: Stocks, ETFs To Watch

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After the closing bell on Jul 24, International Business Machines (NYSE: IBM) reported strong second-quarter 2024 results. It beat estimates for earnings and revenues, citing rising customer demand for new AI projects. IBM shares spiked 4% in aftermarket hours.

IBM Beats Q2 Earnings on AI Growth: ETFs to Buy

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Over half of US states have high levels of Covid-19 in wastewater as President Biden isolates with virus. New vaccines expected by Sept.

COVID Activity Is Elevated Across 26 States In Summer Surge, Biden Remains In Isolation: 3 Vaccine Stocks To Watch

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The U.S. Food and Drug Administration (FDA) may approve <a href="http://Long Covid Remains Diagnostic Mystery, Diagnosis Remains Elusive; National Institutes of Health-Funded Study Shows">updated COVID-19 vaccines</a> this week to combat recent strains as the country endures its most significant summer outbreak in two years.
The FDA is expected to give the nod to updated mRNA vaccines from Moderna, Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/MRNA#NASDAQ">MRNA</a>) and Pfizer Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/PFE#NYSE">PFE</a>), which is collaborating with BioNTech SE (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/BNTX#NASDAQ">BNTX</a>), to fight a COVID strain called KP.2, CNN <a href="https://www.cnn.com/2024/08/16/health/fda-updated-covid-19-vaccines/index.html">reported</a> Sunday. 
It was uncertain whether the agency would approve Novovax, Inc.&#8217;s (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NVAX#NASDAQ">NVAX</a>) most recent vaccine for COVID&#8217;s JN.1 strain at the same time, the report said. 
Representatives for Pfizer and Moderna told CNN they have plenty of updated COVID vaccines ready for shipment to stores upon approval.
Novovax executives said in a conference call last week that the company&#8217;s updated vaccine would arrive in warehouses for distribution some time this month because its vaccine is based on protein technology and therefore takes longer to make.
Read Also: <a href="https://www.benzinga.com/general/biotech/24/07/39847869/covid-activity-is-elevated-across-26-states-in-summer-surge-biden-remains-in-isolation-3-vaccine-">COVID Activity Is Elevated Across 26 States In Summer Surge, Biden Remains In Isolation: 3 Vaccine Stocks To Watch</a>
Summer COVID Wave: Levels of the SARS-CoV-2 virus, COVID-19&#8217;s cause, measured in wastewater are at "very high" levels across the U.S., Centers for Disease Control and Prevention data shows. 
COVID waves result from waning immunity and new variants, according to experts. According to CDC data, the KP.3.1.1 strain accounts for 37% of cases over the last two weeks, tripling from a month ago.
KP.3.1.1 and KP.2 are both JN.1 offshoots, and all three are&nbsp;versions of the Omicron variant.
As of Aug. 13, COVID-19 infections are growing or likely growing in 25 states, declining or likely declining in five states and are stable or uncertain in 17 states, <a href="https://www.cdc.gov/cfa-modeling-and-forecasting/rt-estimates/index.html">according</a> to CDC data.
States where infections are growing include Alabama, North Dakota, South Dakota, Georgia, Kentucky, Massachusetts, New Hampshire, Vermont and Virginia.
Price Action: Moderna, Pfizer and Novovax made gains into Monday&#8217;s late-morning trading, while most of the exchange-traded funds that track them also trended upward.
ETFs with Moderna, which gained 1.72% to $88.33.
<ul>
<li>Langar Global HealthTech ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/LGHT#NYSE">LGHT</a>) ticked up 0.37%</li>
<li>Amplify Treatments, Testing and Advancements ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/GERM#NYSE">GERM</a>) declined 1.13%</li>
<li>Invesco Nasdaq Biotechnology ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/IBBQ#NASDAQ">IBBQ</a>) edged up 1.28%</li>
</ul>
ETFs with Pfizer, which rose 1.55% to $28.74.
<ul>
<li>First Trust Nasdaq Pharmaceuticals ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/FTXH#NASDAQ">FTXH</a>) went up 1.19%</li>
<li>First Trust Morningstar Dividend Leaders Index Fund (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/FDL#NYSE">FDL</a>) gained 0.73%</li>
<li>Invesco Pharmaceuticals ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/PJP#NYSE">PJP</a>) rose 0.10%</li>
</ul>
ETFs with Novovax, which shot up 5.98% to $13.73.
<ul>
<li>ProShares Nanotechnology ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/TINY#NYSE">TINY</a>) slipped 0.62%</li>
<li>iShares Genomics Immunology and Healthcare ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/IDNA#NYSE">IDNA</a>) rose 0.89%</li>
<li>Virtus LifeSci Biotech Products ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/BBP#NYSE">BBP</a>) remained unchanged</li>
</ul>
Read Next:
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<li><a href="https://feeds2.benzinga.com/news/24/01/36635307/anthony-faucis-ex-boss-now-admits-covid-19-lab-leak-theory-is-credible-and-not-a-conspiracy">Anthony Fauci&#8217;s Ex-Boss Now Admits COVID-19 Lab Leak Theory Is Credible And &#8216;Not A Conspiracy&#8217;</a></li>
</ul>
Photo: Unsplash

After the closing bell on Jul 24, International Business Machines (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/ibm#NYSE">IBM</a>) reported strong second-quarter 2024 results. It beat estimates for earnings and revenues, citing rising customer demand for new AI projects. IBM shares spiked 4% in aftermarket hours.
Investors seeking to tap the strength could consider ETFs having the highest allocation to this tech giant. These funds are First Trust NASDAQ Technology Dividend Index Fund (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/tdiv#NASDAQ">TDIV</a>), FT Cboe Vest Technology Dividend Target Income ETF, FT Cboe Vest DJIA Dogs 10 Target Income ETF (BATS: <a class="ticker" href="https://www.benzinga.com/stock/dogg#BATS">DOGG</a>), Invesco Dow Jones Industrial Average Dividend ETF (ARCA:DJD) and Morningstar Dividend Leaders Index Fund (ARCA:FDL).
IBM&#39;s second-quarter earnings per share came in at $2.43, surpassing the Zacks Consensus Estimate of $2.16 and improving from the year-ago earnings of $2.18. Revenues grew 2% year over year to $15.8 billion and edged past the consensus estimate of $15.6 billion.
Consulting revenues dipped 1% in the quarter, while software revenues grew 7% from the year-ago levels. IBM is capitalizing on the growing demand for AI integration. The company&#39;s book of business for generative AI has grown to more than $2 billion since the launch of watsonx one year ago.
IBM reaffirmed its full-year guidance for mid-single-digit revenue growth for 2024.
The 113-year-old company expects software revenues to grow at a high-single-digit percentage in 2024, above the previous forecast of the high end of mid-single-digit percentage. The higher forecast came on the back of higher AI-linked spending by clients looking to adopt the technology. However, IBM lowered its consulting revenue growth projections to low single-digit percentages for 2024 from 6%-8%.
<h3>ETFs in Focus</h3>
First Trust NASDAQ Technology Dividend Index Fund
First Trust NASDAQ Technology Dividend Index Fund provides exposure to dividend payers within the technology and telecommunication sector by tracking the Nasdaq Technology Dividend Index. It charges 50 bps in annual fees and holds about 87 securities in its basket. Of these firms, IBM takes the third spot, making up 8.5% of the assets.
First Trust NASDAQ Technology Dividend Index Fund has amassed $2.7 billion in its asset base while trading in a volume of around 91,000 shares per day.&nbsp;
FT Cboe Vest Technology Dividend Target Income ETF
FT Cboe Vest Technology Dividend Target Income ETF is an actively managed fund that seeks to provide a target level of current income and capital appreciation by holding a portfolio of dividend-paying U.S. technology companies. The fund utilizes a call-writing option strategy on the Nasdaq 100 Index and/or the S&amp;P 500 Index or related ETFs. It holds 87 securities in its basket, with IBM taking the third spot at 8.4% share.
FT Cboe Vest Technology Dividend Target Income ETF has accumulated $30.7 million in its asset base and trades in a volume of 9,000 shares per day on average. It charges 75 bps in annual fees.
FT Cboe Vest DJIA Dogs 10 Target Income ETF
FT Cboe Vest DJIA Dogs 10 Target Income ETF seeks to provide current income with a secondary objective of providing capital appreciation. It provides exposure to the &quot;Dogs of the Dow&quot; the 10 highest dividend-yielding stocks in the Dow Jones Industrial Average on an annual basis. DOGG holds 41 stocks in its basket, with IBM occupying the second position at 6% share.
FT Cboe Vest DJIA Dogs 10 Target Income ETF has accumulated $34.1 million in its asset base and trades in a volume of 11,000 shares. It charges 75 bps in fees and expenses.&nbsp;
Invesco Dow Jones Industrial Average Dividend ETF
Invesco Dow Jones Industrial Average Dividend ETF offers exposure to dividend-paying companies included in the Dow Jones Industrial Average by their 12-month dividend yield over the prior 12 months. It holds 29 stocks in its basket, with IBM occupying the eighth position, accounting for 4.7%.
Invesco Dow Jones Industrial Average Dividend ETF has managed assets worth $298.8 million while trading in a volume of 21,000 shares a day on average. It charges 7 bps in annual fees and has a Zacks ETF Rank #3 (Hold).
First Trust Morningstar Dividend Leaders Index Fund
First Trust Morningstar Dividend Leaders Index Fund offers exposure to stocks that have shown the highest dividend consistency and dividend sustainability by tracking the Morningstar Dividend Leaders Index. It holds 100 stocks in its basket, with IBM taking the seventh spot at 4.6% share.
With AUM of $4 billion, First Trust Morningstar Dividend Leaders Index Fund charges 45 bps in annual fees from investors and trades in a solid volume of about 449,000 shares a day. It has a Zacks ETF Rank #2 (Buy) with a Medium risk outlook.
<a href="https://www.zacks.com/stock/news/2309191/ibm-beats-q2-earnings-on-ai-growth-etfs-to-buy?cid=CS-BENZ-FT-etf_news_and_commentary-2309191">To read this article on Zacks.com click here.</a>

More than half of the states in the U.S. are experiencing <a href="https://www.benzinga.com/24/07/39829417/biden-gets-covid-19-takes-a-fiesty-dig-at-tesla-ceo-im-sick-of-elon-musk-and-his-rich-buddies-trying">significant Covid-19 activity </a>in wastewater, and President Joe Biden remains in isolation after announcing Wednesday he caught the virus for the third time.
Twenty-six states are reporting either &#8220;high&#8221; or &#8220;very high&#8221; levels of the virus at various sites, according to the latest<a href="https://www.cdc.gov/nwss/rv/COVID19-currentlevels.html"> data </a>from the Centers for Disease Control and Prevention.
States with the highest levels include Arkansas, California, Florida, Maryland, Nevada, Oregon and Texas. 
The Biden administration no longer considers Covid-19 a public health emergency and instead treats it as a routine respiratory virus to be prevented through an annual vaccination campaign, the Washington Post <a href="https://www.washingtonpost.com/health/2024/07/18/biden-covid-summer-wave-symptoms-flirt-variant/">reported</a>.
Also Read: <a href="https://www.benzinga.com/general/biotech/24/07/39823289/european-commission-faces-court-criticism-over-covid-vaccine-contract-transparency-ahead-of-vote-">European Commission Faces Court Criticism Over COVID Vaccine Contract Transparency Ahead Of Vote on Ursula Von Der Leyen&#8217;s Reappointment</a>
Biden is staying at his Rehoboth Beach home in Delaware while continuing to perform presidential duties.
Vaccine Stocks To Watch: Novovax, Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NVAX#NASDAQ">NVAX</a>), Moderna, Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/MRNA#NASDAQ">MRNA</a>) and Pfizer Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/PFE#NYSE">PFE</a>) are all making new Covid vaccines that should be available before the end of September, the New York Times <a href="https://www.nytimes.com/article/long-covid-vaccine.html">reported</a>.
The Novavax vaccine will target JN.1, the variant that was prominent in the winter and spring.
Pfizer and Moderna are developing shots aimed at KP.2, which accounts for about one in four new cases. Two related variants, KP.3 and LB.1, are the culprint behind more than half of new cases, the Times said. 
All three variants are descendants of JN.1, so each of the vaccines is expected to be effective against them.
NVAX, MRNA, PFE Price Action: Novovax shares were down 5.7% to $14.94 late in Thursday&#8217;s session. Moderna was down 2.16% to $121.37. Pfizer is down 1.07% at $29.70. 
Exchange-traded funds that hold shares of Pfizer, which has the largest market capitalization of the group of vaccine developers at $169 billion, declined in Thursday afternoon trading. 
<ul>
<li>First Trust Nasdaq Pharmaceuticals ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/FTHX#NASDAQ">FTHX</a>) fell 0.35%.</li>
<li>First Trust Morningstar Dividend Leaders Index Fund (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/FDL#NYSE">FDL</a>) slipped 0.69%.</li>
<li>Invesco Pharmceuticals ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/PJP#NYSE">PJP</a>) slid 0.55%.</li>
<li>Harbor Health Care ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/MEDI#NYSE">MEDI</a>) lost 0.33%.</li>
<li>Invesco S&amp;P Ultra dividend Revenue ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/RDIV#NYSE">RDIV</a>) declined 0.66%.</li>
</ul>
Read Now: 
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<li><a href="https://www.benzinga.com/news/24/07/39770202/moderna-regeneron-pharmaceuticals-and-2-other-stocks-insiders-are-selling">Moderna, Regeneron Pharmaceuticals And 2 Other Stocks Insiders Are Selling</a></li>
</ul>
Photo via Shutterstock.

International Business Machines Corporation&nbsp;(NYSE:<a class="ticker" href="https://www.benzinga.com/stock/IBM#NYSE">IBM</a>) has reportedly triumphed in a legal battle, overturning $1.6 billion in damages awarded to&nbsp;BMC Software Inc. in 2022.&nbsp;
The dispute stemmed from&nbsp;IBM&#8217;s implementation of&nbsp;its&nbsp;own&nbsp;software while servicing their shared client,&nbsp;AT&amp;T Inc&nbsp;(NYSE:<a class="ticker" href="https://www.benzinga.com/stock/T#NYSE">T</a>).
The U.S. 5th Circuit Court of Appeals ruled in favor of IBM, nullifying one of the largest-ever judgments in a commercial dispute, according to a report from&nbsp;<a target="_blank" href="https://www.bloomberg.com/news/articles/2024-04-30/ibm-gets-1-6-billion-poaching-award-to-bmc-thrown-out-on-appeal?srnd=technology-vp&amp;sref=TBDibEcD" rel="noreferrer noopener">Bloomberg</a>.
Judges found that IBM lawfully acquired AT&amp;T&#8217;s mainframe software account without breaching agreements with BMC.
Also Read:&nbsp;<a target="_blank" href="https://www.benzinga.com/markets/equities/24/04/38465075/whats-going-on-with-ibm-stock-amid-expansion-in-canada" rel="noreferrer noopener">IBM Signs Agreements With The Government Of&nbsp;Canada&nbsp;</a>
Houston-based BMC sued IBM in 2017, alleging&nbsp;<a target="_blank" href="https://www.yahoo.com/video/court-orders-ibm-pay-1-165712912.html" rel="noreferrer noopener">violation&nbsp;</a>of a no-poach agreement.
The appeals court judges agreed that AT&amp;T&#8217;s decision to switch software was independent of IBM&#8217;s influence.
The case is BMC Software v. IBM, 22-20463, U.S. Fifth Circuit Court of Appeals (New Orleans).
IBM stock has gained more than 31% in the past 12 months. Investors can gain exposure to IBM via&nbsp;First&nbsp;Trust Morningstar Dividend Leaders Index Fund&nbsp;(NYSE:<a class="ticker" href="https://www.benzinga.com/stock/FDL#NYSE">FDL</a>) and&nbsp;First Trust NASDAQ Technology Dividend Index Fund&nbsp;(NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/TDIV#NASDAQ">TDIV</a>).
Price Action: IBM shares are trading lower by 0.45% at $165.46 in premarket at&nbsp;the last check Wednesday.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
Read Next: <a href="https://www.benzinga.com/news/earnings/24/04/38421190/ibm-ceo-arvind-krishna-teams-up-with-nvidia-to-accelerate-clients-ai-journeys-amid-1b-in-bookings" target="_blank" rel="noreferrer noopener">IBM CEO Arvind Krishna Teams Up With Nvidia &#8216;To Accelerate Clients&#8217; AI Journeys&#8217; Amid $1B In Bookings</a>
Credit: Shutterstock

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IBM Emerges Victorious In $1.6B Legal Battle: Report

Oppenheimer&nbsp;analyst Timothy Horan maintained&nbsp;Verizon Communications Inc&nbsp;(NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VZ#NYSE">VZ</a>) with an Outperform rating and a&nbsp;<a href="https://www.benzinga.com/quote/VZ/analyst-ratings" target="_blank" rel="noreferrer noopener">$48&nbsp;price target</a>. The stock is trading higher on Tuesday following Monday&#8217;s first-quarter print.
Horan noted Verizon continued to build on strong momentum from 2023, driven by significant network upgrades, refreshed management and improved go-to-market. Results were messy due to January price increases, which he noted impacted volumes, as did one-time expenses, which is a good setup for strong FCF growth.&nbsp;
Also Read:&nbsp;<a target="_blank" href="https://www.benzinga.com/news/earnings/24/04/38356319/verizons-q1-flat-revenue-bump-in-free-cash-flow-and-stable-2024-outlook" rel="noreferrer noopener">Verizon&#8217;s Q1: Flat Revenue, Bump In Free Cash Flow And Stable 2024 Outlook</a>
A 25bps EBITDA beat could have been larger given low upgrade volumes, but as the analyst stated, returning to subscriber growth is prioritized.
Horan said Verizon was much better positioned than two years ago, with solid momentum and trends were set to improve further.&nbsp;
It remains one of his best dividend plays with an attractive ~7% yield. Debt is high at $151.7 billion, but paydown is of focus and should be reduced by over $6 billion per year, as per Horan.
The analyst flagged ARPA grew 3.9%, driven by pricing action and consistent myPlan adoption, which created a recurring revenue stream of perks/services.&nbsp;
He said the second quarter would be the high watermark for growth, given the quarter impact of price increases, followed by tougher year-on-year comps in the second half.
Postpaid phone net adds of -68K improved vs fiscal first-quarter 2023&#8217;s -127K. He estimated as many as 50K phone additions were from second lines, but this is a limited opportunity and not a primary source of momentum. The company expects to achieve positive Consumer net adds for fiscal 2024.&nbsp;
<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="750" height="650" src="https://editorial-assets.benzinga.com/wp-content/uploads/2024/04/23120758/newplot-26.png" alt="" class="wp-image-304854" srcset="https://editorial-assets.benzinga.com/wp-content/uploads/2024/04/23120758/newplot-26.png 750w,https://editorial-assets.benzinga.com/wp-content/uploads/2024/04/23120758/newplot-26-300x260.png 300w" sizes="(max-width: 750px) 100vw, 750px" /></figure>
The analyst said Verizon now serves over 11 million broadband customers across FWA and wireline. FWA net adds moderated to +354K, but this was not unexpected given ramping competition from&nbsp;AT&amp;T Inc&nbsp;(NYSE:<a class="ticker" href="https://www.benzinga.com/stock/T#NYSE">T</a>) and the low move environment. FiOS remains steady at +53K net adds.&nbsp;
Horan trimmed fiscal 2024 and 2025 revenue by 20bps each, mainly on weaker equipment revenues but a net positive for EBITDA and FCF. He reduced fiscal 2024 and 2025 EPS by $0.01 each on higher interest expense. The analyst maintained his remaining fiscal 2024 quarterly and 2025 postpaid phone net adds and FWA estimates. The fiscal 2024 FCF estimate of $19 billion is unchanged, but $1.5 billion was shifted from the first to the second half.
Verizon stock gained 8% in the past 12 months. Investors can gain exposure to the stock via&nbsp;Invesco Dow Jones Industrial Average Dividend ETF&nbsp;(NYSE:<a class="ticker" href="https://www.benzinga.com/stock/DJD#NYSE">DJD</a>) and&nbsp;First Trust Morningstar Dividend Leaders Index Fund (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/FDL#NYSE">FDL</a>).
VZ Price action: Verizon shares traded higher by 3.45% at $39.93 at the last check Tuesday.
Read Next: <a href="https://www.benzinga.com/news/earnings/24/04/38381615/whats-going-on-with-tesla-stock-ahead-of-earnings-tuesday">What&#8217;s Going On With Tesla Stock Ahead Of Earnings Tuesday?</a>
Photo: Shutterstock

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Reiteration

Verizon Poised For Growth, Strategic Network Upgrades, Strong Momentum To Drive Future Success: Analyst

Verizon Communications Inc&nbsp;(NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VZ#NYSE">VZ</a>) stock traded higher Monday after it reported fiscal&nbsp;<a target="_blank" href="https://www.benzinga.com/pressreleases/24/04/g38353377/verizon-begins-2024-with-strong-wireless-service-revenue-growth-solid-cash-flow-and-continued-mome" rel="noreferrer noopener">first-quarter 2024 results</a>.&nbsp;
Its sales increased 0.2% year over year to $32.98 billion, marginally missing the consensus of $33.24 billion. Adjusted EPS of $1.15 beat the&nbsp;<a target="_blank" href="https://www.benzinga.com/calendars/earnings" rel="noreferrer noopener">consensus of $1.12</a>.
Total wireless service revenue was $19.5 billion, up 3.3% Y/Y, driven primarily by pricing actions implemented in recent quarters, higher premium price plan adoption, and growth of its fixed wireless subscriber base. Postpaid phone net losses were 68,000, and retail postpaid net additions were 253,000.
The quarter marked 389,000 total broadband net additions.&nbsp;The company ended the quarter with approximately 11.1 million broadband subscribers.
Total Verizon Business revenues were $7.4 billion, down by 1.6% Y/Y.
Total Verizon Consumer revenue rose by 0.8% Y/Y to $25.1 billion. Consumer wireless retail postpaid churn was 1.03%, and wireless retail postpaid phone churn was 0.83%. 
Verizon Consumer clocked wireless retail postpaid phone net losses of 158,000. Verizon Consumer had fixed wireless net additions of 203,000.
The consumer segment EBITDA margin improved by 110 bps 42.6%, attributed to service revenue growth and lower upgrade volumes, while the business segment EBITDA margin declined 130 bps to 20.7%, driven by wireline revenue declines.&nbsp;
Company-level adjusted EBITDA of $12.1 billion, up from $11.9 billion Y/Y.
Verizon Chairman and CEO Hans Vestberg. &#8220;We are on track to meet our financial guidance and to deliver positive Consumer postpaid phone net adds for the year.&#8221;
FY24 Outlook: Verizon&nbsp;<a target="_blank" href="https://www.benzinga.com/news/earnings/24/01/36738263/verizons-q4-performance-shines-substantial-wireless-gains-boost-stock" rel="noreferrer noopener">reiterated a 2.0% – 3.5%</a>&nbsp;wireless service revenue growth. It maintained an adjusted EPS of $4.50 – $4.70 versus&nbsp;<a target="_blank" href="https://www.benzinga.com/calendars/guidance" rel="noreferrer noopener">consensus of $4.58</a>.
Verizon stock gained over 9% in the last 12 months. Investors can gain exposure to the stock via&nbsp;Invesco Dow Jones Industrial Average Dividend ETF&nbsp;(NYSE:<a class="ticker" href="https://www.benzinga.com/stock/DJD#NYSE">DJD</a>) and&nbsp;First Trust Morningstar ETF&nbsp;(NYSE:<a class="ticker" href="https://www.benzinga.com/stock/FDL#NYSE">FDL</a>).
Price action: VZ shares traded higher by 2.17% at $41.37 premarket on the last check Monday.
Photo by JeepersMedia on Flickr

Guidance

Verizon's Q1: Flat Revenue, Bump In Free Cash Flow And Stable 2024 Outlook

The U.S. telecommunications industry is experiencing a volatile period following a detailed investigation conducted by the Wall Street Journal revealing that telecom companies, such as AT&amp;T Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/T#NYSE">T</a>), Verizon Communications Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VZ#NYSE">VZ</a>), Telephone and Data Systems Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/TDS#NYSE">TDS</a>), Frontier Communications Parent Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/FYBR#NASDAQ">FYBR</a>) and others neglected more than 2,000 lead-containing cables across the country that were installed under the old Bell System <a href="https://www.benzinga.com/government/23/07/33158334/toxic-lead-covered-cables-from-at-t-verizon-and-other-telecoms-are-hazardous-wsj">and are now decaying.</a>
Environmental researchers, collaborating with Journal reporters, conducted tests on water and sediment samples from various locations. Shockingly, eight out of 12 tests showed elevated levels of lead contamination.
<h2 class="wp-block-heading">Lead-Cabling Controversy Hits Telecoms Stocks: Analysts React</h2>
The market impact was swift and severe. Analysts, including <a href="https://www.benzinga.com/analyst-ratings/analyst-color/23/07/33256330/at-t-verizon-plummet-to-multidecade-lows-toxic-lead-investigation-sparks-telco-sell">Citigroup&#8217;s Michael Rollins</a>, wasted no time downgrading the affected stocks due to the environmental threat. 
On Monday, shares of AT&amp;T plummeted to their lowest value since 1993, dropping 7%. Although there was a slight recovery attempt on Tuesday&#8217;s opening, AT&amp;T ultimately closed flat. 
Verizon shares also experienced a significant decline, hitting their lowest point in over a decade on Monday with a 7.5% drop, followed by a marginal 2.4% rebound on Tuesday. TDS saw the most notable recovery on Tuesday, surging 9% after an 8.4% decline on Monday.
<h2 class="wp-block-heading">Telecom Companies Respond to Lead Cable Concerns:</h2>
In response to the Wall Street Journal&#8217;s investigation, the telecom companies and USTelecom, a group representing the broader industry, defended their practices. 
They emphasized that they provide safety training and protective gear to workers to handle lead properly. 
AT&amp;T said in a press release that it does not consider lead-sheathed cables to be a public health concern, citing scientific literature. The company also criticized the testing methodologies used by the newspaper and questioned the credibility of one of the testing companies due to a conflict of interest.
TDS acknowledged the presence of a limited amount of lead cabling in its network and said it is identifying the next steps to address the issue while complying with applicable laws. Verizon did not issue a PR on the matter.
<h2 class="wp-block-heading">5 ETFs With The Highest Exposure To Telecom Stocks</h2>
Among the exchange-traded funds that show a concentration of holdings in telecommunication stocks affected by the lead-cabling crisis, Benzinga found:
<figure class="wp-block-table"> 
<table>
<thead>
<tr>
<th>ETF Name</th>
<th>T (weight %)</th>
<th>VZ (%)</th>
<th>TDS (%)</th>
<th>FYBR (%)</th>
</tr>
</thead>
<tbody>
<tr>
<td>iShares U.S. Telecommunications ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/IYZ#NYSE">IYZ</a>)</td>
<td>4</td>
<td>11.8</td>
<td>0</td>
<td>2.5</td>
</tr>
<tr>
<td>iShares Trust &#8211; iShares Global Comm Services ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/IXP#NYSE">IXP</a>)</td>
<td>2.59</td>
<td>3.55</td>
<td>0</td>
<td>2.3</td>
</tr>
<tr>
<td>SPDR S&amp;P Telecom ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/XTL#NYSE">XTL</a>)</td>
<td>3</td>
<td>3.1</td>
<td>3.5</td>
<td>3</td>
</tr>
<tr>
<td>Vanguard Communication Services ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VOX#NYSE">VOX</a>)</td>
<td>3.8</td>
<td>4.4</td>
<td>0.1</td>
<td>0</td>
</tr>
<tr>
<td>Invesco S&amp;P 500 Equal Weight Communication Services ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/RSPC#NYSE">RSPC</a>)</td>
<td>4</td>
<td>4.1</td>
<td>0</td>
<td>0</td>
</tr>
</tbody>
</table>
</figure>
Also Read: <a href="https://www.benzinga.com/news/23/07/33253034/whats-going-on-with-verizon-shares">What&#8217;s Going On With Verizon Shares</a>
Photo: Shutterstock

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Specialty ETFs

FYBR

iShares Trust S&P Global Telecommunications Sector Index Fund

iShares Dow Jones US Telecommunications Sector Index Fund

RSPC

VLUE

Telecom Stocks Under Pressure As Toxic Lead Cable Concerns Discourage Buyers: 5 ETFs To Watch

Shares in telecom giants AT&amp;T Inc (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/T#NYSE">T</a>), Verizon Communication Inc (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VZ#NYSE">VZ</a>), Telephone and Data Systems, Inc (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/TDS#NYSE">TDS</a>), and Frontier Communication Parent, Inc (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/FYBR#NASDAQ">FYBR</a>) dropped dramatically Monday, shedding 7% to 15%. The Wall Street Journal&#8217;s investigation revealing the neglect of a network of harmful lead-coated cables <a href="http://benzinga.com/government/23/07/33158334/toxic-lead-covered-cables-from-at-t-verizon-and-other-telecoms-are-hazardous-wsj">prompted the market backlash.</a>
In a note released Monday, Citigroup analyst Michael Rollins examined the situation regarding the cable network deployed by these telecom companies nationwide. 
According to Rollins, a considerable percentage of these cables may have lead sheathing, with varied amounts of exposure for each company. As a result, the analyst believes that this issue will continue to have an impact on stocks and their valuation for a few months, if not longer, until the market has a better understanding of the financial risk involved.
Rollins stated that gathering more information regarding the matter could take several months, and that a final resolution could take years. According to Citigroup&#8217;s current scenario estimate, most wireline telecommunications companies will experience a firm valuation discount ranging from 0.2x to 1.0x of EBITDA.
Also Read: <a href="https://www.benzinga.com/markets/eurozone/23/07/33255186/tesla-prepares-to-double-berlin-factory-size-aiming-for-1-million-evs-annually">Tesla Prepares To Double Berlin Factory Size, Aiming For 1 Million EVs Annually</a>
Chart: AT&amp;T Tumbles to February 1993 Levels, Verizon to November 2010
<figure class="wp-block-image size-large"><img decoding="async" loading="lazy" width="1024" height="702" src="https://s3.amazonaws.com/editorial.benzinga.com/wp-content/uploads/2023/07/17152456/T_2023-07-17_21-22-59_aba83-1024x702.png" alt="" class="wp-image-69555" srcset="https://s3.amazonaws.com/editorial.benzinga.com/wp-content/uploads/2023/07/17152456/T_2023-07-17_21-22-59_aba83-1024x702.png 1024w,https://s3.amazonaws.com/editorial.benzinga.com/wp-content/uploads/2023/07/17152456/T_2023-07-17_21-22-59_aba83-300x206.png 300w,https://s3.amazonaws.com/editorial.benzinga.com/wp-content/uploads/2023/07/17152456/T_2023-07-17_21-22-59_aba83-768x526.png 768w,https://s3.amazonaws.com/editorial.benzinga.com/wp-content/uploads/2023/07/17152456/T_2023-07-17_21-22-59_aba83-1536x1052.png 1536w,https://s3.amazonaws.com/editorial.benzinga.com/wp-content/uploads/2023/07/17152456/T_2023-07-17_21-22-59_aba83.png 1804w" sizes="(max-width: 1024px) 100vw, 1024px" /></figure>
<h2 class="wp-block-heading">Citigroup Actions</h2>
In response to recent developments, Citigroup has downgraded its ratings on AT&amp;T, Telephone and Data Systems, and Frontier Communication to Neutral/High Risk. While the price targets for these stocks have been reduced to $16, $8, and $17, respectively.
<h2 class="wp-block-heading">ETF That Holds Telcos</h2>
The U.S.-listed exchange-traded funds with the highest exposure to AT&amp;T are the iShares MSCI USA Value Factor ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VLUE#NYSE">VLUE</a>) with a 5.1% weight and the iShares U.S. Telecommunications ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/IYZ#NYSE">IYZ</a>) with a 4.2% weight.
The iShares Trust &#8211; iShares U.S. Telecommunications ETF also has a large stake in Verizon (12.4%), which is also represented by an 8.3% weight in the First Trust Morningstar Dividend Leaders Index Fund (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/FDL#NYSE">FDL</a>). 
Frontier Communication is a 3% holding in the SPDR S&amp;P Telecom ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/XTL#NYSE">XTL</a>).
<h2 class="wp-block-heading">Telcos&#8217; Response</h2>
In response to the investigation, AT&amp;T and USTelecom, an industry group, developed websites debunking concerns about the environmental and public health implications of lead cables. 
A spokesperson for USTelecom emphasized that&nbsp;there is no evidence that legacy lead-sheathed telecom cables are a significant source of lead exposure or a public health concern. The representative additionally stressed the importance of safe work procedures in the telecommunications industry in avoiding worker exposure to lead.
Read now: <a href="https://www.benzinga.com/news/23/07/33249131/at-t-stock-is-trading-lower-whats-going-on">AT&amp;T Stock Is Trading Lower: What&#8217;s Going On?</a>
Photo: Shutterstock

Downgrades

AT&T, Verizon Plummet To Multidecade Lows: Toxic Lead Investigation Sparks Telco Sell-Off, Analysts Head For The Exits

Carnage in the oil patch isn&#39;t limited to energy stocks and dedicated crude exchange traded funds. Although energy&#39;s weight is rapidly dwindling in major equity benchmarks, oil&#39;s decline has wide-ranging implications for the broader economy and global equity markets.
In the world of ETFs, oil&#39;s demise is gripping predictable fare, such as industry,<a href="https://www.benzinga.com/news/20/04/15850400/crippled-crude-oil-presents-conundrum-for-these-russia-saudi-arabia-etfs"> sector and single-country funds.</a>
But wait. There&#39;s more.
Although the sector has been an epicenter of negative dividend action this year, it&#39;s increasingly a high-yield play, both at home and abroad. Just look at the Energy Select Sector SPDR (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/xle#NYSE">XLE</a>). The largest energy ETF is now yielding 14.76%.
That&#39;s staggering and as the <a href="https://www.etfrc.com/index.php">ETF Research Center</a> (ETFRC) notes, plenty of other ETFs, including some dividend funds, are being hampered by large energy weights. Here are a few examples.
See Also: <a href="https://www.benzinga.com/news/20/04/15850400/crippled-crude-oil-presents-conundrum-for-these-russia-saudi-arabia-etfs">Crippled Crude Oil Presents Conundrum For These Russia, Saudi Arabia ETFs</a>
<h3>iShares Core High Dividend ETF (HDV)</h3>
The iShares Core High Dividend ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/hdv#NYSE">HDV</a>) is a high dividend strategy by design, but with almost <a href="https://www.ishares.com/us/products/239563/?referrer=tickerSearch">a quarter of its weight</a> dedicated to energy stocks, this may not be the high-yield strategy built for these times.
HDV allocates over 16% of its weight to Dow components Exxon Mobil (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/xom#NYSE">XOM</a>) and Chevron (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/cvx#NYSE">CVX</a>) and those dividends are sustainable for this year, but that may be the best news to come from this ETF&#39;s outsized energy exposure, which is the highest among non-sector funds.
HDV&#39;s energy weight is, predictably, pressuring the fund as its lower by almost 21% year-to-date.
<h3>First Trust Morningstar Dividend Leaders Index Fund (FDL) </h3>
The First Trust Morningstar Dividend Leaders Index Fund (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/fdl#NYSE">FDL</a>) shares a few of things in common with HDV. Coincidentally, both funds track Morningstar indexes. Exxon is the largest holding in both funds and more importantly, FDL joins its iShares rival in having one of the biggest energy weights among dividend funds.
FDL&#39;s energy allocation <a href="https://www.ftportfolios.com/Retail/Etf/EtfSummary.aspx?Ticker=FDL">is almost 23%</a>, the bulk of which is sourced from a combined 17% weight to Exxon and Chevron.
As yield-based strategy, FDL doesn&#39;t disappoint with a dividend yield of 6.31%, but the energy exposure implies that yield is high for a reason &mdash; one that&#39;s not positive.
<h3>WisdomTree Emerging Markets High Dividend Fund (DEM)</h3>
The WisdomTree Emerging Markets High Dividend Fund (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/dem#NYSE">DEM</a>), as its name implies, is another high-yield strategy, but with a dividend yield approaching 7%, that&#39;s elevated even by this fund&#39;s standards.
DEM&#39;s energy exposure is mainly attributable to a roughly <a href="https://www.wisdomtree.com/etfs/equity/dem">18% weight to Russia</a>, which is more than quadruple the weight assigned to that country by the MSCI Emerging Markets Index.
The fund&#39;s energy weight is also a tad above 18% and four of its energy components are found among its top 10 holdings. DEM&#39;s energy exposure is among the largest for ex-U.S. ETFs.
Disclosure: The author owns shares of DEM.

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Commodities

3 Dividend ETFs With Way Too Much Energy Exposure

Blue-chip averages carved out mouth-watering gains <a href="http://www.benzinga.com/general/education/17/12/10925476/asset-class-year-in-review-equities-commodities-cryptos-and-cannabi">in 2017</a>, thanks to a favorable macroeconomic milieu and still-accommodative monetary policy environment.
The S&amp;P 500 Index, a broader gauge, added 19.42 percent for the year, while the more narrow Dow Industrial Average advanced 25.08 percent. The tech-weighted Nasdaq Composite Index gained 28.24 percent.
Finding value in an overbought market is tough, and a trading strategy called the &quot;dogs of the Dow&quot; has shown to be a safer bet for picking stocks that can consistently beat the total market return.
<h3>
	A Dividend-Based Strategy</h3>
The<a href="https://www.investopedia.com/university/stockpicking/stockpicking8.asp">&nbsp;investment strategy</a>&nbsp;by money manager Michael O&#39;Higgins chooses 10 of the 30 components of the Dow Industrial Average.
The 10 stocks are picked after the last trading day of the year&nbsp;and are the 10 Dow stocks with the highest dividend yields.&nbsp;
A dividend yield is the dividend divided by the current stock price and expressed as a percentage.&nbsp;
To follow the strategy, traders invest&nbsp;equal amounts in each of the 10 stocks on the first trading day of the new year and hold them in a portfolio until the end of the year. This process is repeated at the beginning of each year.
The dogs of the Dow method is a long-term trading strategy.
See also: <a href="https://www.benzinga.com/general/biotech/17/12/10927494/the-companies-that-led-2017s-biotech-rally"> The Companies That Led 2017&#39;s Biotech Rally </a>
<h3>
	2017: A Good Year For Dogs&nbsp;</h3>
The <a href="http://www.benzinga.com/trading-ideas/long-ideas/16/12/8831534/meet-the-new-dogs-2017s-dogs-of-the-dow-include-coca-cola-boe">Dow dogs</a>&nbsp;outperformed the S&amp;P 500 in 2017, with the average total return of the former being 23.67 percent compared to 21.83 percent for the index, Bank of America Merrill Lynch analyst Stephen Suttmeier said in a recent note.
The stocks have performed well relative to the S&amp;P 500 since 2001. IIf the Dow Jones High Yield Select 10 Total Return Index is taken as a proxy for the dogs of the Dow, their average annual return since 2001 has been 10.10 percent compared to 7.98 percent for the S&amp;P 500 Index, Suttmeier said.
<h3>
	2017 Dogs With Positive Returns</h3>
<ul>
<li>
		Boeing Co (NYSE: <a class="ticker" href="/stock/ba#NYSE">BA</a>)</li>
<li>
		Caterpillar Inc. (NYSE: <a class="ticker" href="/stock/cat#NYSE">CAT</a>)</li>
<li>
		Chevron Corporation (NYSE: <a class="ticker" href="/stock/cvx#NYSE">CVX</a>)</li>
<li>
		The Coca-Cola Co (NYSE: <a class="ticker" href="/stock/ko#NYSE">KO</a>)</li>
<li>
		Pfizer Inc. (NYSE: <a class="ticker" href="/stock/pfe#NYSE">PFE</a>)</li>
<li>
		Verizon Communications Inc. (NYSE: <a class="ticker" href="/stock/vz#NYSE">VZ</a>)</li>
</ul>
Of these, Boeing, Caterpillar and Cisco outperformed the S&amp;P 500 Index.
<h3>
	2017 Dogs With Negative Returns</h3>
<ul>
<li>
		Exxon Mobil Corporation (NYSE: <a class="ticker" href="/stock/xom#NYSE">XOM</a>)</li>
<li>
		International Business Machines Corp. (NYSE: <a class="ticker" href="/stock/ibm#NYSE">IBM</a>)</li>
<li>
		Merck &amp; Co., Inc. (NYSE: <a class="ticker" href="/stock/mrk#NYSE">MRK</a>)</li>
And the most interesting list: this year&#39;s dogs.&nbsp;
</ul>
<h3>
	BofA&#39;s Dogs Of The Dow In 2018</h3>
<ul>
<li>
		Chevron</li>
<li>
		Cisco Systems</li>
<li>
		Coca-Cola</li>
<li>
		Exxon Mobil</li>
<li>
		General Electric</li>
<li>
		IBM</li>
<li>
		Merck</li>
<li>
		Pfizer</li>
<li>
		Procter &amp; Gamble</li>
<li>
		Verizon</li>
</ul>
For passive investors, some ETFs and ETNs offer exposure to these 10 stocks. They include:
<ul>
<li>
		Deutsche Bank AG ELEMENTS Dogs of the Dow Total Return Index Note ELEMENTS Dogs of the </li>
<li>
		ALPS ETF Trust (NYSE: <a class="ticker" href="/stock/sdog#NYSE">SDOG</a>)</li>
<li>
		iShares Trust (NYSE: <a class="ticker" href="/stock/hdv#NYSE">HDV</a>)</li>
<li>
		First Trust Morningstar Divid Ledr (ETF) (NYSE: <a class="ticker" href="/stock/fdl#NYSE">FDL</a>)</li>
<li>
		Vanguard Telecommunication Services ETF (NYSE: <a class="ticker" href="/stock/vox#NYSE">VOX</a>)</li>
</ul>
Related Link:
<a href=" https://www.benzinga.com/investing/best-online-brokerage/"> Best Online Brokerage </a>

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SPDR Dow Jones Industrial Average ETF Trust

SDOG

A Strategy That Beat The S&P 500: Here Are Your 2018 'Dogs Of The Dow'

Shares of General Electric Co. (NYSE: <a class="ticker" href="/stock/ge#NYSE">GE</a>) plunged 7.5 percent on more than quadruple the average daily volume Monday after the Dow component, as was widely expected, <a href="https://www.benzinga.com/media/cnbc/17/11/10772455/after-ge-slashes-its-dividend-who-will-be-next">unveiled a dividend cut</a> as part of its turnaround effort.
GE&#39;s quarterly dividend will be 12 cents a share, down from 24 cents, marking one of the largest dividend cuts among S&amp;P 500 firms since the global financial crisis.
&ldquo;The dividend allocation will be $4.2 billion for 2018, pushing it from above 100 percent of free cash flow to 60 percent to 70 percent, and the dividend yield from 4.7 percent to 2.3 percent,&rdquo; reports <a href="https://www.cnbc.com/2017/11/13/ge-announces-broad-restructuring-to-keep-health-care-aviation-and-energy-units.html">CNBC</a>. &ldquo;The yield had been the highest in 30 years not counting the financial crisis.&rdquo;&nbsp;
GE&#39;s status as a dividend cutter could affect the stock&#39;s status in some well-known dividend exchange traded funds.
<h3>
	ETF Impact</h3>
GE previously cut its payout during the financial crisis. Although the dividend rebounded, until Monday, in recent years, that prior cut disqualified the stock from ETFs that mandate stocks have a minimum dividend increase streak to be included in the fund. Some of the most popular dividend ETFs have payout increase streak requirements ranging from 10 to 25 years.
For now, it is just speculation, but some dividend ETFs that entered Monday holding GE could dramatically reduce or eliminate GE exposure when those funds undergo their next rebalancing. The $1.66 billion First Trust Morningstar Dividend Leaders Index Fund (NYSE: <a class="ticker" href="/stock/fdl#NYSE">FDL</a>) entered Monday with a 4.6 percent weight to GE, making the stock that ETF&#39;s sixth-largest holding.
FDL, which is over 11 years old, tracks the Morningstar Dividend Leaders Index. While that benchmark does not have an explicit dividend increase streak requirement, it does look for high-yield stocks &ldquo;that have a consistent record of dividend payment and have the ability to sustain their dividend payments,&rdquo; <a href="http://www.morningstar.com/InvGlossary/morningstar-dividend-leaders-index.aspx">according to Morningstar</a>.&nbsp;
FDL rebalances in December.
<h3>
	Other Possibilities</h3>
The First Trust Value Line Dividend Index Fund (NYSE: <a class="ticker" href="/stock/fvd#NYSE">FVD</a>) has a small stake in GE (none of the ETF&#39;s holdings account for more than 0.65 percent of its weight), but FVD components must meet certain Value Line safety criteria. That could be a sign that GE&#39;s days in FVD are numbered.
FVD&#39;s underlying index is rebalanced monthly, so investors in the $4 billion ETF should soon know GE&#39;s fate in the fund. FDL was unchanged Monday while FVD finished modestly higher.
Related Links:
<a href="https://www.benzinga.com/news/17/11/10767058/gold-is-losing-some-glitter-as-demand-wilts">Gold ETFs Lose Some Shine</a>
<a href="https://www.benzinga.com/trading-ideas/long-ideas/17/11/10767059/an-etf-to-deal-with-central-bank-shenanigans">A Dynamic Europe ETF</a>

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First Trust Value Line Dividend Index Fund ETF

Some Dividend ETFs Could Give GE The Boot

When it comes to income investing, perhaps the only thing sweeter than the dividend itself is a steadily rising dividend. Clearly, income investors love knowing that some companies raise dividends year after year.

	That helps explain why investors continue to allocate capital to such familiar names as Coca-Cola (NYSE: <a class="ticker" href="/stock/ko#NYSE">KO</a>), Johnson &amp; Johnson (NYSE: <a class="ticker" href="/stock/jnj#NYSE">JNJ</a>) and Procter &amp; Gamble (NYSE: <a class="ticker" href="/stock/pg#NYSE">PG</a>).

	Those blue chips and plenty of others have lengthy histories of increasing their payouts. In the cases of J&amp;J and P&amp;G, those dividend increase streaks are now beyond five decades. ETF sponsors have capitalized on the trend of investors' desire for steadily rising payouts by constructing funds that use length of dividend increase streaks as a primary screening criteria.

	In fact, the two largest U.S. dividend ETFs, the Vanguard Dividend Appreciation ETF (NYSE: <a class="ticker" href="/stock/vig#NYSE">VIG</a>) and the SPDR S&amp;P Dividend ETF (NYSE: <a class="ticker" href="/stock/sdy#NYSE">SDY</a>), both use dividend increase streaks as the way for filtering possible constituents. VIG tracks the NASDAQ US Dividend Achievers Select Index, which requires constituents to have increased dividends every year for at least the past decade.

	SDY tracks the S&amp;P High Yield Dividend Aristocrats Index, which requires a dividend increase streak of 25 years. Combined, these two ETFs have about $25.8 billion in assets under management, indicating investors are quite comfortable with these ETFs, although both yield less than three percent.

	However, for all the assets VIG and SDY have accumulated and for all the attention these ETFs get in the mainstream media and the blogosphere, investors should consider alternative weighting methodologies with dividend ETFs. The proof is in the proverbial pudding as some ETFs that do not use dividend increase streaks as a primary weighting tool <a href="http://www.benzinga.com/trading-ideas/long-ideas/13/03/3443830/what-type-of-dividend-etfs-are-winning-in-2013">have performed well over the past several years</a>. Among that group are ETFs that weigh by yield.

	Weigh By Yield 
	Another common strategy employed by dividend ETFs is weighting fund components by yield. Vanguard offers a yield-weighted alternative to VIG in the form of the popular Vanguard High Yield Dividend ETF (NYSE: <a class="ticker" href="/stock/vym#NYSE">VYM</a>). VYM tracks the FTSE High Dividend Yield Index, which measures the investment return of common stocks of companies characterized by high dividend yields, <a href="https://personal.vanguard.com/us/funds/snapshot?FundId=0923&amp;FundIntExt=INT">according to the issuer. </a>

	VYM had <a href="https://personal.vanguard.com/us/funds/snapshot?FundId=0923&amp;FundIntExt=INT">$7.5 billion in assets</a> at the end of March. The iShares High Dividend Equity Fund (NYSE: <a class="ticker" href="/stock/hdv#NYSE">HDV</a>) tracks the Morningstar Dividend Yield Focus Index, which focuses only companies that pay dividends that are considered qualified income, so no real estate investment trusts are found in this ETF. The index takes the top 75 companies by yield and filters for those that "have a Morningstar Economic Moat rating of narrow or wide and have a Morningstar Distance to Default score in the top 50% of eligible dividend-paying companies," <a href="http://corporate.morningstar.com/us/documents/Indexes/INS_INX_DividendYieldFocusIndex.pdf">according to Morningstar</a>.

	HDV has amassed $3.2 billion in AUM barely more than two years of trading. The First Trust Morningstar Dividend Leaders Index Fund (NYSE: <a class="ticker" href="/stock/fdl#NYSE">FDL</a>) follows the Morningstar Dividend Leaders Index. That index "captures the performance of 100 highest yielding stocks that have a consistent record of dividend payment and have the ability to sustain their dividend payments. Stocks in the index are weighted in proportion to the total pool of dividends available to investors," <a href="http://www.morningstar.com/InvGlossary/morningstar-dividend-leaders-index.aspx">according to Morningstar</a>.

	While FDL is not as big as its aforementioned peers, the ETF is not exactly small. The ETF has nearly $610 million in assets under management and its underlying index has consistently outperformed the S&amp;P 500 over one-, three- and five-year time frames with a lower a standard deviation, <a href="http://www.ftportfolios.com/Retail/Etf/EtfSummary.aspx?Ticker=FDL">according to First Trust data</a>.

	Speaking Of Returns 
	Including paid dividends, SDY and VIG are up 21.3 percent and 16.2 percent, respectively, over the past 12 months. Obviously, that is not too shabby. However, investors have been compensated by reaching for some added yield. Over the same time, the average return delivered by FDL, HDV and VYM was 21.7 percent.

	Interestingly, all three of those ETFs <a href="http://www.etfreplay.com/charts.aspx">less volatile than SDY and VIG as well</a>.

	Moving out to a two-year time frame, HDV is not only the best performer of the group with a return of 38.6 percent, but that ETF has also been the least volatile of the five funds highlighted here. While being nearly 400 basis points less volatile than SDY, HDV has outpaced that ETF by 870 basis points over the past two years.

	Since April 2011, FDL, HDV and VYM have generated average returns of nearly 35 percent. The average return offered by SDY and VIG over the same time is 26.4 percent.

	To be clear, this analysis is not intended to knock VIG and SDY. These are fine ETFs in their own right and if investors prefer to own ETF that strives to include steady dividend raisers, than VIG and SDY are excellent bets. And of course, as a Vanguard ETF, VIG offers a paltry expense ratio of just 0.13 percent, making it less expensive than 88 percent of comparable funds.

	Then again, not only has VYM been the better performer, but it has the lower expense ratio at 0.1 percent, making it cheaper than 92 percent <a href="https://personal.vanguard.com/us/funds/snapshot?FundId=0923&amp;FundIntExt=INT">of similar ETFs</a>.

	For more on dividend ETFs, click <a href="http://www.benzinga.com/analyst-ratings/analyst-color/13/04/3511553/s-p-likes-the-biggest-dividend-etf">here</a>.

Long Ideas

Intraday Update

Non-Streak Dividend ETFs Impress

The Sharpe ratio, a risk measurement and management tool named for Nobel laureate William F. Sharpe, is as easy to explain as it is important. At its core, the Sharpe Ratio tells investors whether a portfolio's success is due to <a href="http://www.investopedia.com/terms/s/sharperatio.asp#axzz2IAj9IwaV">savvy investment decisions or taking on unnecessary risk</a>.

Calculated by subtracting the risk free rate – such as the returns offered by short-term Treasuries – from the rate of return for a portfolio and dividing the result by the standard deviation of the portfolio returns, according to Investopedia, the Share Ratio tells investors just how good a portfolio's risk-adjusted performance has been. 

A high Sharpe Ratio indicates good risk-adjusted performance while a low Sharpe Ratio indicates investors would have been better off with a more conservative investment vehicle. 

Since equity-based ETFs are baskets of stocks, or portfolios themselves, using the Sharpe Ratio to find winning funds makes sense. What follows just a few of the ETF this Sharpe Ratio screen. Screen parameters: Sharpe Ratio of 0.5 and higher, three-year total returns of at least 10 percent, expense ratio of below one percent and a beta against the S&amp;P 500 of no higher than 1.5. Please note this screen was <a href="https://research.zecco.com/research/etf-screener.asp">run on Zecco</a>, which near as we could tell, offers one of the only free Sharpe Ratio screeners.

Vanguard Dividend Appreciation ETF (NYSE: <a class="ticker" href="/stock/vig#NYSE">VIG</a>)
The aforementioned screen turned up 230 and equity-based ETFs and perhaps not surprisingly, nearly 10 percent of that group hails from the Vanguard family. VIG is already the largest dividend ETF by assets, but that shallow metric does not indicate the fund's true worth to conservative investors, but the screen does.

VIG has an expense ratio of just 0.13 percent, making it less expensive than 88 percent of comparable funds, <a href="https://personal.vanguard.com/us/funds/snapshot?FundId=0920&amp;FundIntExt=INT">according to Vanguard</a>. VIG's beta against the S&amp;P 500 is just 0.82 percent and that does not come by virtue of an excessive weight to utilities names, a favorite beta-reducing trick of some ETFs. That sector accounts for just 1.8 percent of VIG's weight.

With a Sharpe Ratio 0.85, VIG has gained almost 11 percent in the past three years.

iShares MSCI Thailand Investable Market Index Fund (NYSE: <a class="ticker" href="/stock/thd#NYSE">THD</a>)
While the screen did not turn out to be heavy on emerging markets ETFs, the total number that met the criteria was decent and those funds that did make the cut offer investors exposure to both Asian and Latin American developing markets.

As is the case with VIG, THD's inclusion on this list probably is not a surprise to those that are familiar with the fund. The lone Thailand-specific ETF has been one of the best-performing ETFs of any type <a href="http://www.benzinga.com/trading-ideas/long-ideas/13/01/3208282/10-for-13-emerging-markets-etfs-for-2013">since the March 2009 market bottom</a>. Fees of 0.6 percent mean THD comes cheaper than the comparable China fund.

THD's Sharpe Ratio, according to Zecco data, is 1.1, meaning it is double that of the Sharpe Ratio on the supposedly more conservative iShares MSCI South Korea Index Fund (NYSE: <a class="ticker" href="/stock/ewy#NYSE">EWY</a>).

First Trust NASDAQ-100 Equal Weighted Index (NASDAQ: <a class="ticker" href="/stock/qqew#NASDAQ">QQEW</a>)
An underrated way of grabbing technology sector exposure <a href="http://www.benzinga.com/trading-ideas/long-ideas/13/01/3249669/apples-slide-highlights-advantages-of-equal-weight-etfs">while dodging single-stock risk</a> QQEW has recently performed better than some marquee tech ETFs, such as the Technology Select Sector SPDR (NYSE: <a class="ticker" href="/stock/xlk#NYSE">XLK</a>).

However, there is more to QQEW's story. In addition to a solid Sharpe Ratio of 0.61, QQEW offers investors a low price/cash flow ratio of 11.08, <a href="http://www.ftportfolios.com/Retail/Etf/EtfSummary.aspx?Ticker=QQEW">according to First Trust data</a>. That is relevant because securities with low price/cash flow ratios <a href="http://www.thepatternsite.com/CashFlow.html">have a tendency to outperform those with high price/cash flow ratios</a>. 

Other ETFs that appeared in the screen with Sharpe Ratios above follow here with the Sharpe Ratios after the tickers: First Trust Morningstar Dividend Leaders Index Fund (NYSE: <a class="ticker" href="/stock/fdl#NYSE">FDL</a>) 1.2, iShares NASDAQ Biotechnology Index Fund (NASDAQ: <a class="ticker" href="/stock/ibb#NASDAQ">IBB</a>) 1.14, PowerShares Dynamic Cosnumer Discretionary Portfolio (NYSE: <a class="ticker" href="/stock/psl#NYSE">PSL</a>), 1.1, Guggenheim S&amp;P 500 Equal Weight Consumer Staples ETF (NYSE: <a class="ticker" href="/stock/rhs#NYSE">RHS</a>) 1.29 and the WisdomTree Dividend Ex-Financials Fund (NYSE: <a class="ticker" href="/stock/dtn#NYSE">DTN</a>) 1.21.

For more on ETFs, click <a href="http://www.benzinga.com/etfs">here</a>.

Technicals

PowerShares Dynamicnsumer Staples Sector Portfolio

First Trust NASDAQ-100 Equal Weighted Index Fund

QQEW

Rydex ETF Trust Rydex S&P Equal Weightnsumer Staples ETF

iShares MSCI Thailand Investable Market Index Fund

Use The Sharpe Ratio For Profits With These ETFs

It is simple economics. The Federal Reserve's low interest rate policy and plans to keep rates low through 2015 have chased yield-hungry investors out of cash investments and into higher-yielding products. ETF sponsors have met investors' yield demands with aplomb, rolling out new <a href="http://www.benzinga.com/news/12/10/2994697/powershares-to-introduce-low-vol-high-dividend-etf">dividend-based products on a regular basis this year</a>.

The impact of investors' dividend desires is obvious. Dividend ETFs, new and old, have seen assets under management totals surge. Thirty-two dividend ETFs tracked by Dorsey Wright &amp; Associates collectively grew assets by 40 percent through the end of the third quarter compared to asset growth of 23 percent for all ETFs, <a href="http://alletf.com/content/new-dividend-etfs-being-created-just-not-equally">according to data provided by the firm</a>.

There are more than 32 dividend ETFs on the market today and the Dorsey Wright data does not include funds such as the First Trust Nasdaq Technology Dividend Index Fund (NYSE: <a class="ticker" href="/stock/tdiv#NYSE">TDIV</a>), <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/10/3015362/some-niche-etfs-seeing-decent-inflows">which debuted just two months ago</a> and already has $30.4 million in AUM.

It is also worth noting that inflows to dividend ETFs have not been reserved for U.S.-focused funds. International payout funds tracking developed <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/09/2878500/has-a-new-era-dawned-for-em-dividend-etfs">and emerging markets</a> have seen AUM totals surge as well.

Staying Home
With Europe's sovereign debt crisis and slowing emerging markets growth on the minds of investors, many have opted for U.S. equities over international equivalents. That has helped the S&amp;P 500 enjoy a double-digit year-to-date gain. It also means investors have pumped plenty of cash into ETFs tracking U.S. dividend payers.

And those inflows have not been going just to the most familiar products such as the Vanguard Dividend Appreciation ETF (NYSE: <a class="ticker" href="/stock/vig#NYSE">VIG</a>) and the SPDR S&amp;P Dividend ETF (NYSE: <a class="ticker" href="/stock/sdy#NYSE">SDY</a>), though those funds have grabbed their share of inflows. At the end of 2011, VIG had $8.9 billion in AUM, but that number had swelled to almost $11.9 billion at the end of the third quarter. SDY has seen its AUM haul jump 14.6 percent since the end of 2011.

On a percentage basis among U.S. equity dividend ETFs, no fund even comes close to the Schwab U.S. Dividend Equity ETF (NYSE: <a class="ticker" href="/stock/schd#NYSE">SCHD</a>), which has seen its AUM total nearly quadruple since the end of 2011. Give the ELEMENTS DJ High Yield Select 10 ETN (NYSE: <a class="ticker" href="/stock/dod#NYSE">DOD</a>) some credit for trying to compete with SCHD in terms of asset growth. The ETN has seen its assets more than triple this year, according to Dorsey Wright data.

Other impressive 2012 asset growers include the iShares High Dividend Equity Fund (NYSE: <a class="ticker" href="/stock/hdv#NYSE">HDV</a>), one of 2011's most successful ETF launches. HDV had less than $920 million in AUM when the ball last dropped in Times Square. As of the close of markets on Monday, the ETF had almost $2.3 billion in assets.

The Guggenheim Multi-Asset Income ETF (NYSE: <a class="ticker" href="/stock/cvy#NYSE">CVY</a>), the First Trust Morningstar Dividend Leaders Index Fund (NYSE: <a class="ticker" href="/stock/fdl#NYSE">FDL</a>) and the First Trust Value Line Dividend Index Fund (NYSE: <a class="ticker" href="/stock/fvd#NYSE">FVD</a>) also have seen stellar AUM growth.

Going Global
As was noted earlier, investors have plenty of choices when it comes to international dividend funds. The Global X Super Dividend ETF (NYSE: <a class="ticker" href="/stock/sdiv#NYSE">SDIV</a>) is not a pure play global ETF as the U.S. accounts for almost 36 percent of SDIV's weight, but the real sources of allure here are a 30-day SEC yield of 6.7 percent and a monthly dividend. 

Dorsey Wright data indicate SDIV had just $29 million in AUM at the end of 2011. That number is a now $154.5 million, meaning SDIV's assets have <a href="http://www.benzinga.com/markets/bonds/12/10/2995308/etfs-with-amazing-asset-growth">surged almost 55 percent in just two months</a>.

In terms of issuers, WisdomTree (NASDAQ: <a class="ticker" href="/stock/wetf#NASDAQ">WETF</a>) has seen an impressive, if under-appreciated burst of inflows into its global dividend products this year. The WisdomTree Emerging Markets Equity Income Fund's (NYSE: <a class="ticker" href="/stock/dem#NYSE">DEM</a>) AUM total has more than doubled this year, representing another feather in the cap of an ETF that <a href="http://www.benzinga.com/markets/bonds/12/09/2905122/5-etfs-with-surging-aum-totals">often outperforms rivals</a> such as the Vanguard MSCI Emerging Markets ETF (NYSE: <a class="ticker" href="/stock/vwo#NYSE">VWO</a>) and the iShares MSCI Emerging Markets Index Fund (NYSE: <a class="ticker" href="/stock/eem#NYSE">EEM</a>).

Four other WisdomTree global dividend ETFs have seen asset growth ranging from 20 percent to 31 percent this year, according to Dorsey Wright. Those funds are the WisdomTree Australia Dividend (NYSE: <a class="ticker" href="/stock/ause#NYSE">AUSE</a>), the WisdomTree DEFA Equity Income Fund (NYSE: <a class="ticker" href="/stock/dth#NYSE">DTH</a>), the WisdomTree Global Equity Income Fund (NYSE: <a class="ticker" href="/stock/dew#NYSE">DEW</a>) and the WisdomTree International Div ex-Financials ETF (NYSE: <a class="ticker" href="/stock/doo#NYSE">DOO</a>). 

Do not forget small caps. The WisdomTree Emerging Markets SmallCap Dividend Fund (NYSE: <a class="ticker" href="/stock/dgs#NYSE">DGS</a>) had $800 million in <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/05/2553741/under-the-hood-an-oldie-but-goodie-dgs-thd-vwo">AUM as of mid-February</a>. That number is now approaching $1.1 billion.

Despite Europe's woes, the First Trust STOXX European Select Dividend Index Fund (NYSE: <a class="ticker" href="/stock/fdd#NYSE">FDD</a>) has seen its AUM total surge almost 64 percent this year. FDD has a 30-day SEC yield of 6.53 percent. The Europe-heavy Guggenheim International Multi-Asset Income ETF (NYSE: <a class="ticker" href="/stock/hgi#NYSE">HGI</a>) is fast approaching $117 million in AUM after finishing 2011 with just $86 million.

Emerging markets dividend ETFs <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/09/2878500/has-a-new-era-dawned-for-em-dividend-etfs">are not taking a backseat</a> to developed market rivals. The iShares Emerging Markets Dividend Index Fund (NYSE: <a class="ticker" href="/stock/dvye#NYSE">DVYE</a>) debuted in late February and already has $44.7 million in AUM. That means DVYE has a long way to go to catch the SPDR S&amp;P Emerging Markets Dividend ETF (NYSE: <a class="ticker" href="/stock/ediv#NYSE">EDIV</a>). With $315.3 million in assets, EDIV's AUM total has almost doubled this year.

For more on dividend ETFs, click <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/09/2878500/has-a-new-era-dawned-for-em-dividend-etfs">here</a>.

New ETFs

Pre-Market Outlook

AUSE

Wisdomtree Emerging Markets Smallcap Dividend Fund

Elements ETN-Dow Jones High Yield Select 10 Total Return Index

WisdomTree Trust International Dividend Top 100

DVYE

EDIV

First Trust STOXX European Select Dividend Income Fund

Guggenheim International Multi-Asset Income ETF

SCHD

SDIV

WETF

The Indomitable Rise of Dividend ETFs

There is still some debate as to what assets under management watermarks an ETF needs to reach to ensure profitability for the fund's sponsor. As has been noted, <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/04/2465525/etf-opinion-the-100m-watermark-is-asinine">impressive size is nothing more than impressive size when it comes to ETFs</a>.

Size is not a guarantee of a fund's ability to generate alpha. Still, the investment community loves numbers. When it comes to exchange-traded products, conventional (though not necessarily correct) wisdom seems to stipulate an ETF with $50 million in AUM will be profitable for the fund's sponsor while an ETF with $100 million or more in AUM is assured survival. 

There are some cold realities regarding the ETF landscape. One of those realities includes the fact that <a href="http://blogs.barrons.com/focusonfunds/2012/07/02/harder-for-new-etf-entrants-to-gain-traction-citi-says/?mod=google_news_blog">new funds are finding it harder to standout, as Barron's recently noted</a>. Another is that all U.S.-listed ETFs and ETNs combined had $1.17 trillion in AUM at the end of June, but $220.1 billion of that total belonged to just three funds – the SPDR S&amp;P 500 (NYSE: <a class="ticker" href="/stock/spy#NYSE">SPY</a>), the SPDR Gold Shares (NYSE: <a class="ticker" href="/stock/gld#NYSE">GLD</a>) and the Vanguard Emerging Markets ETF (NYSE: <a class="ticker" href="/stock/vwo#NYSE">VWO</a>).

It is hard for plenty of ETFs with over $100 million in AUM to standout, but there are some anonymous $100 million (or more) ETFs that are worth considering even if the so-called exports have not discovered these funds yet.

PowerShares Dynamic Energy Sector Portfolio (NYSE: <a class="ticker" href="/stock/pxi#NYSE">PXI</a>)
The PowerShares Dynamic Energy Sector Portfolio is not quite the competitor to the Energy Select SPDR (NYSE: <a class="ticker" href="/stock/xle#NYSE">XLE</a>) it would appear to be. Nor is PXI a direct rival to ETFs such as the SPDR S&amp;P Oil &amp; Gas Exploration &amp; Production ETF (NYSE: <a class="ticker" href="/stock/xop#NYSE">XOP</a>) or the iShares Dow Jones US Oil &amp; Gas Exploration Index Fund (NYSE: <a class="ticker" href="/stock/ieo#NYSE">IEO</a>).

PXI features a little a bit of everything from the energy sector, meaning integrated oil producer as well as independent names are found in this ETF along with MLPs, coal producers and refiners. More importantly, PXI has outperformed IEO, XLE and XOP year-to-date. As of July 3, PXI had almost $113 million in AUM.

First Trust Morningstar Dividend Leaders Index Fund (NYSE: <a class="ticker" href="/stock/fdl#NYSE">FDL</a>)
With almost $587 million in AUM, the First Trust Morningstar Dividend Leaders Index Fund is by no means small. Despite FDL's heft, it is somewhat ignored in the conversation about dividend ETFs. That should not be the case. FDL has a 30-day SEC yield north of four percent and in the past 90 days, the fund has outperformed larger, more popular dividend ETFs such as the Vanguard Dividend Appreciation ETF (NYSE: <a class="ticker" href="/stock/vig#NYSE">VIG</a>), the SPDR S&amp;P Dividend ETF (NYSE: SDV) and the iShares High Dividend Equity Fund (NYSE: <a class="ticker" href="/stock/hdv#NYSE">HDV</a>).

FlexShares Morningstar Global Upstream Natural Resources ETF (NYSE: <a class="ticker" href="/stock/gunr#NYSE">GUNR</a>)
It can be argued that the universe of materials and energy ETFs is saturated. There simply does not need to be more new ETFs tracking these sectors. It can also be said that the FlexShares Morningstar Global Upstream Natural Resources ETF could have fallen victim to bad timing. The ETF debuted in September 2011 and with energy names struggling over the past several months, it would have been fair to assume GUNR would struggle to accumulate assets.

That has not been the case. In just 10 months on the market, GUNR has raked in over $379.1 million in AUM. GUNR does offer one-stop shopping for investors looking for resources exposure as the fund's 121 holdings include fertilizer producers, integrated oil names and gold miners among others. The fund is a rival to the older Market Vectors RVE Hard Assets Producers ETF (NYSE: <a class="ticker" href="/stock/hap#NYSE">HAP</a>).

PowerShares S&amp;P 500 BuyWrite Portfolio (NYSE: <a class="ticker" href="/stock/pbp#NYSE">PBP</a>)
The PowerShares S&amp;P 500 BuyWrite Portfolio is worth a look for investors searching for income in form of covered call writing. PBP's benchmark is the CBOE S&amp;P 500 BuyWrite Index, which measures the rate of return on an S&amp;P 500 covered call strategy, according to PowerShares. Not surprisingly, the consistent use of options contracts does leave PBP with an expense ratio that is much higher than a typical S&amp;P 500 index fund (PBP charges 0.75 percent).

PBP, which has almost $208 million in AUM, reinvests dividends and the options premiums generated from the covered calls. The red flag: PBP has trailed the SPDR S&amp;P 500 (NYSE: <a class="ticker" href="/stock/spy#NYSE">SPY</a>) by a wide margin this year.

GUNR

Market Vectors RVE Hard Assets Producers ETF

iShares Dow Jones US Oil & Gas Exploration & Production Index Fund

PowerShares Dynamic Energy Sector Portfolio

Anonymous ETFs With $100M+ in AUM (FDL, GUNR, PBP)

Alright, maybe we're being a bit picky. After all, finding a plain vanilla equity-based or commodities ETF that is even down on a year-to-date basis is no easy task. Strip out the bond funds and leveraged and inverse fare and the number of ETFs that are negative slips dramatically.

Alas, we're talking about DISAPPOINTING ETFs, not just those that are negative to start the year. So the list that follows includes some ETFs that are in fact in the red and others that are positive, but should be so by greater margins. 

Some of the constituents here are have potential to right the ship. Others could be in even worse shape come December. With no further ado...

Teucrium Corn Fund (NYSE: <a class="ticker" href="/stock/corn#NYSE">CORN</a>)
CORN was decked in January by a USDA inventories report that showed stronger-than-forecast corn supplies. That's the primary reason for CORN's glum year-to-date run and to the fund's credit, it has maid up some of those losses. What makes CORN a disappointment is that riskier assets and many of the ETFs tracking them, have been rewarded this year. Any of the ETFs backed by physical holdings of precious metals, all of which are far cheaper than CORN, have sharply outperformed this ag commodities play.

First Trust Morningstar Dividend Leaders ETF (NYSE: <a class="ticker" href="/stock/fdl#NYSE">FDL</a>)
Yes, it should be acknowledged that the First Trust Morningstar Dividend Leaders ETF is trading just pennies away from its 52-week high. And yes, it should be acknowledged the ETF isn't down by all that much year-to-date. However, it should also be said that FDL has lagged the performance of the SPDR S&amp;P Dividend ETF (NYSE: <a class="ticker" href="/stock/sdy#NYSE">SDY</a>) and the Vanguard Dividend Appreciation ETF (NYSE: <a class="ticker" href="/stock/vig#NYSE">VIG</a>).

Explaining FDL's tough go in 2012 is easy. The ETF features a weight of 26.3% to utilities stocks and that group has not been embraced thus far this year.

Market Vectors Indonesia Index ETF (NYSE: <a class="ticker" href="/stock/idx#NYSE">IDX</a>)
We've already mentioned IDX <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/02/2319401/pretenders-not-contenders-some-em-etfs-disappointing-to-start">as an emerging markets disappointment</a> even though the fund is positive year-to-date. Then again, IDX has been sharply outpaced by the country-specific funds for the following nations: Malaysia, the Philippines, Thailand and Vietnam. 

iShares MSCI South Africa Index Fund (NYSE: <a class="ticker" href="/stock/eza#NYSE">EZA</a>)
Normally, an almost 9% jump to start the year the year would be impressive, but in EZA's case, it's not all that much to get worked up about. South Africa is a major platinum, but getting platinum exposure through EZA would have some investors fuming because the ETFS Physical Platinum Shares (NYSE: <a class="ticker" href="/stock/pplt#NYSE">PPLT</a>) has more than doubled EZA's returns. Even the Vanguard MSCI Emerging Markets ETF (NYSE: <a class="ticker" href="/stock/vwo#NYSE">VWO</a>) has far outperformed EZA to start the year.

iShares S&amp;P Global Energy ETF (NYSE: <a class="ticker" href="/stock/ixc#NYSE">IXC</a>)
The iShares S&amp;P Global Energy ETF is an ETF that, despite having almost $1.2 billion in AUM, doesn't get <a href="http://www.benzinga.com/news/earnings/12/01/2253871/five-key-etfs-for-q4-earnings-reports">a lot of press</a>. The performance has been solid thus far in 2012, but there are dents in the armor here.

First rolling the dice on BP (NYSE: <a class="ticker" href="/stock/bp#NYSE">BP</a>) would have been more rewarding than playing IXC. Second, the much smaller SPDR S&amp;P International Energy Sector ETF (NYSE: <a class="ticker" href="/stock/ipw#NYSE">IPW</a>) has slightly outperformed IXC despite having a much larger allocation to Royal Dutch Shell (NYSE: RDS-A), one of the laggards among global integrated oil stocks to start the year.

Futures

Global

CORN

iShares Trust S&P Global Energy Sector Index Fund

PPLT

5 Of 2012's Most Disappointing ETFs

BlackRock, Inc. (<a class="ticker" href="/stock/blk#">BLK</a>) yesterday (3/31/11) launched the iShares High Dividend Equity Fund (HDV).  The new ETF provides exposure to high quality income-producing U.S. securities based on the Morningstar Dividend Yield Focus Index.
The underlying index seeks to identify companies providing relatively high dividend yields on a consistent basis.  Morningstar's proprietary methodology screens for superior company quality and financial health.  The process uses Morningstar's Economic Moat rating system, which describes the sustainability of a company's future economic profits.  It also uses the Morningstar Distance to Default measure, which quantifies the likelihood that a company may encounter financial distress.
Unlike many other dividend ETFs that have a high exposure to Financials, Morningstar's process currently produces just a 2.5% weighting to that sector. Overall sector breakdown comes in with Health Care at 25.4%, Consumer Goods 21.4%, Telecommunications 17.4%, Utilities 13.0%, Energy 10.8%, Technology 4.8%, Industrials 3.2%, Financials 2.5%, Consumer Services 0.7%, and Materials 0.6%.
HDV currently has 76 holdings, and the stocks with weightings in excess of 5% of the fund's assets include AT&amp;T Inc (<a class="ticker" href="/stock/t#">T</a>) 10.4%, Pfizer Inc (<a class="ticker" href="/stock/pfe#">PFE</a>) 6.8%, Chevron Corp (<a class="ticker" href="/stock/cvx#">CVX</a>) 6.4%, Verizon Communications (<a class="ticker" href="/stock/vz#">VZ</a>) 6.0%, Johnson &amp; Johnson (<a class="ticker" href="/stock/jnj#">JNJ</a>) 6.0%, Proctor &amp; Gamble Co (<a class="ticker" href="/stock/pg#">PG</a>) 5.6%, and Philip Morris International (<a class="ticker" href="/stock/pm#">PM</a>) 5.0%.
The fund has an expense ratio of 0.40%.  Sadly, neither the <a href="http://us.ishares.com/product_info/fund/overview/HDV.htm" target="_blank">overview</a> nor <a href="http://us.ishares.com/content/stream.jsp?url=/content/en_us/repository/resource/fact_sheet/hdv.pdf&amp;mimeType=application/pdf" target="_blank">fact sheet</a> (pdf) presently offer any hint as to what most investors want to know about a dividend ETF – the expected yield.
There is no shortage of competition in the dividend ETF category.  The most similar competitor is the First Trust Morningstar Dividend Leaders Index Fund (<a class="ticker" href="/stock/fdl#">FDL</a>) (<a href="http://www.ftportfolios.com/Retail/etf/etfsummary.aspx?Ticker=FDL" target="_blank">FDL summary</a>).  It too is based on a Morningstar dividend index, this one with 100 holdings and significant overlap with HDV's top holdings.  The process Morningstar uses for FDL's underlying index also produces a low weighting for Financials at just 3.4% and the same four largest sectors.  FDL has a slightly higher expense ratio at 0.45%, but at least we know the yield: 4.1% 30-day SEC yield and 3.4% distribution rate as of 2/28/11.
Disclosure covering writer, editor, and publisher:  No positions in any of the securities mentioned.  No positions in any of the companies or ETF sponsors mentioned.  No income, revenue, or other compensation (either directly or indirectly) received from, or on behalf of, any of the companies or ETF sponsors mentioned.
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HDV: Another Dividend ETF Arrives

As the stock market remain shaky, finding the right investment becomes trickier. As a result people are looking for creative ways to find additional value in the market.
ETFs that offer access to dividends are a great way to get returns while the uncertainty in stocks remains. Good dividends could also shed a positive light to companies. This is especially true when a company is able to raise dividends when competitors lower dividends, or worse, stop paying out dividends totally.
One ETF that has consistently paid out dividends is SPDR S&amp;P Dividend. SPDR S&amp;P Dividend (NYSE: <a href="/stock/sdy">SDY</a>) has produced yields of 5.3% and is down 0.13% to $45.51. 
Measuring High Dividend Yield stocks out of the Financial sector, Wisdom Tree Dividend Ex Financial (NYSE: <a href="/stock/dtn">DTN</a>) yields 3.73% and fell 0.05% to $39.50. 
First Trust Morning Star Dividend Leaders (NYSE: <a href="/stock/fdl">FDL</a>) offers dividend yield of 4.54% with a dividend payout of $0.15 the previous payout date. First Trust Morning Star Dividend Leaders fell 0.1% to $13.58.
Aside from US stocks, foreign stocks also have ETFs that take advantage of the historically higher dividend payouts from European companies. SPDR S&amp;P International Dividend ETF (NYSE: <a href="/stock/dwx">DWX</a>) produced a dividend yield of 3.07% and paid a dividend of 0.42 last September. 
Telecommunications is a growing industry and keep providing steady dividends. IShares S&amp;P Global Telecommunications (NYSE: <a href="/stock/ixp">IXP</a>) delivered Dividend Yield of 4.87% and last paid out a dividend of $1.33. IXP dropped 0.23% to $54.72.
Utilities is another sector that is indispensable. Wisdom Tree International Utilities (NYSE: <a href="/stock/dbu">DBU</a>) has provided a handsome dividend yield of 3.75%. Wisdom Tree International Utilities ETF rose 0.67% to $22.40.

WisdomTree Trust International Utilities Sector Fund

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First Trust Morningstar ETF

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First Trust Morningstar ETF (ARCA:FDL), Quote.Headers.trade-ideas