‘Aristocrat' Dividend ETF’s Novel Approach Working

September 09, 2016

Clearly, DVY is the best performing of the trio year-to-date—it’s also the largest ETF in the high-dividend ETF segment and it’s only slightly more expensive than NOBL, with an expense ratio of 0.39% versus NOBL’s 0.35% price tag.

These two ETFs are merely a sampling of a segment populated by more than 100 funds today. (You can see a comprehensive list here.) But the subtle distinction between these methodologies, and the ensuing sector tilts and exposure differences each portfolio offers in the name of high-dividend investing, is notable.

Both portfolios offer income and growth, and deliver outperformance with lower volatility than a simple investment in SPY, as the three-year chart below shows, but each high-dividend ETF goes about it in a different way.

Charts courtesy of StockCharts.com

The comparison between DVY’s investor-favorite approach to the highest-dividend-paying stocks and NOBL’s focus on the equal-weighted and longer track record of the dividend aristocrats is a good reminder of the importance of looking under the hood before picking the right ETF for your needs.

Contact Cinthia Murphy at [email protected].

 

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