DVY is not alone in its rate sensitivity among dividend ETFs. Since April 30, the SPDR S&P Dividend ETF (NYSEArca: SDY) and the Vanguard High Dividend Yield ETF (NYSEArca: VYM) are higher, but both trail SPY over that time by an average of 420 basis points. REITs? Forget about that group. The Vanguard REIT ETF (NYSEArca: VNQ) has plunged almost 13% since April 30. [Rising Rates Hammer REIT ETFs]
VYM allocates 28% of its combined weight to staples, utilities and telecom names.
To be fair, the rise in interest rates has weighed on other dividend ETFs as well, but some have outpaced the names mentioned to this point since April 30. For example, the FlexShares Quality Dividend Index Fund (NYSEArca: QDF) is up 10.4% over that time.
QDF has quietly amassed $302.7 million in assets under management in just a year of trading and while 13% of the ETF’s weight goes to telecom and utilities stocks, the fund devotes almost 36% of its weight to financials and technology names. [8 Overlooked Smart Beta ETFs]
The FlexShares Quality Dividend Dynamic Index Fund (NYSEArca: QDYN), which uses a higher beta approach than QDF, has a mere 9% weight to utilities and telecom and that has helped the fund jump 11.1% since April 30.
FlexShares Quality Dividend Index Fund
ETF Trends editorial team contributed to this post. Tom Lydon’s clients own shares of DVY and SPY.