Four ETFs that are outperforming market
The market has changed recently and tech stocks, retail plays and stayat-home stocks are no longer ruling the roost, at least for now. So, what’s working now?
Here are four exchange-traded funds that not only are currently outperforming the market, all have strong long-term (three years) return records. Why? Probably because they’re not industry-specific. Thus, they can easily adjust their portfolios to market shifts. So they may be more long-term resilient plays than the exchange-traded-funds I gave you last October.
Better yet, all four are paying meaningful dividends. Even if the market dips, you’ll still be getting paid to own them. Here’s the list.
VictoryShares US Small Cap (ticker: CSB) tracks high-dividendpaying NASDAQ-listed stocks with market capitalizations below $3 billion. Further, to make the list, all must have recorded positive earnings for at least the last four quarters. But that’s just for starters. A lot of research has found that that low volatility stocks (low beta) usually outperform higher beta stocks. So, when configuring the portfolio, VictoryShares overweights the lowest beta stocks.
Biggest holdings include B. Riley Financial (RILY), Waddell & Reed Financial (WDR), and Hyster-Yale Materials Handling (HY). The fund has returned 22% for the past three months, 79% for 12 months, and averaged 16% annually for three years. It’s paying monthly dividends equating to a 3.6% dividend yield.
Invesco High Yield Equity Dividend Achievers (PEY) tracks an index of 50 high-dividend stocks primarily selected based on dividend growth history. Its biggest holdings include Exxon Mobil (XOM), ONEOK (OKE), and Altria Group (MO). The fund has returned 15% for three months, 42% for the past 12 months, and averaged 10% annually for three years. It’s paying monthly dividends equating to a 4.0% yield.
SPDR Russell 1000Yield Focus (ONEY) holds 280 members of the Russell 1000 index. While the stocks are initially selected primarily based on dividend yield, the individual stock weightings are based on profitability and risk measures, Top holdings include Ford Motor (F), HP Inc. (HPQ), and Marathon Petroleum (MPC). The fund has returned 20% for three months, 58% for the past 12 months, and averaged 13% annually for three years. It pays quarterly dividends equating to 2.4% yield.
Schwab US Dividend Equity (SCHD) tracks an index of high-dividend stocks that have paid dividends for a minimum of 10 consecutive years. Further to qualify for the portfolio, these stocks must meet additional earnings, cash flow, and dividend growth requirements. Top holdings include Texas Instruments (TXN), 3M Co. (MMM), and International Business Machines (IBM). The fund returned 12% for three months, 47% for 12 months, and averaged 16% annually for three years. It’s paying quarterly dividends equating to a 3% yield.
Those are my ideas. But, if I were always right, I wouldn’t have to be spending my days pounding away on this keyboard. So, do your own due diligence. The more you know about your stocks and funds, the better your results.
Harry Domash of Aptos publishes the Winning Investing and the Dividend Detective websites. Contact him at www.winninginvesting.com or Santa Cruz Sentinel, 324 Encinal St., Santa Cruz, CA 95060. To see previous Domash columns, visit santacruzsentinel.com/topic/Harry_Domash.