Tue, 17/07/2018 - 16:08
ETF provider Global X Funds has listed the Global X S&P 500 Quality Dividend ETF (CBOE: QDIV).
The firm writes that the QDIV tracks the S&P 500 Quality High Dividend Index. The index portfolio consists of no fewer than 50 stocks from the S&P 500, selecting companies that are within the top 200 of the index universe both by a quality score and by indicated annual dividend yield. Each company's quality score is derived from its return-on-equity, accruals ratio, and financial leverage ratio.
"For Q2 2018 alone, S&P 500 companies issued a record USD111.6 billion in dividends, and 216 of its components increased their cash payments by 13.55 per cent on average," says Vinit Srivastava, Managing Director, Product Management at S&P Dow Jones Indices. "As dividends reach record levels, a need for equity income can be combined with a selection of the higher-quality companies issuing those dividends, which the S&P 500 Quality High Dividend Index can provide. We're pleased to license the index to Global X for its newest income ETF."
By combining a quality screen with dividend yield, the fund seeks to provide investors access to companies that are more likely to maintain their dividend payments throughout changing economic environments.
"The steady rise of interest rates has created a dilemma for income-seeking investors, as bond yields finally become more attractive, but may be coupled with a loss of principal as rates continue to rise," says Jay Jacobs, director of research at Global X. "With QDIV, we are excited to offer a dividend strategy for investors that has the potential both provide quality income and appreciate in value in a strengthening economy."
The fund will be the 12th in Global X's USD3 billion suite of income ETFs.
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