ETF Watch: VictoryShares Debuts Dividend Fund

April 18, 2017

Today Victory Capital Management is rolling out its 12th ETF, a dividend strategy and the first of its funds not to incorporate volatility into the strategy. The VictoryShares Dividend Accelerator ETF (VSDA) targets stocks that pay dividends and that are likely to grow their dividend payments.

VSDA comes with an expense ratio of 0.35% and is listed on the Nasdaq exchange.

Maximize Dividend Growth

The fund tracks the Nasdaq Victory Dividend Accelerator Index, which is derived from the Nasdaq US Large Mid Cap Index. The universe is screened using a quantitative multifactor approach to select the stocks, and then weights the constituents in a way intended to maximize the dividend growth, according to the prospectus.

The index also caps the weight of individual securities and sectors.

The largest dividend growth ETF is the Vanguard Dividend Appreciation ETF (VIG). The 10-year-old fund has $23.4 billion in assets under management and comes with an expense ratio of 0.09%, a little more than a quarter of the management fees charged by VSDA.

However, unlike VSDA, VIG is weighted by market capitalization and has a less forward-looking methodology. It considers only whether a company has consistently grown its dividend payment over the past decade rather than looking to highlight funds that are likely to do so in the future.

Contact Heather Bell at [email protected].

 

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