ETF Talk

This Fund Provides Consistent Income

The exchange-traded fund iShares Select Dividend ETF (DVY) focuses on holding equities with a history of consistent income instead of equities with potential future dividend increases.

All DVY’s holdings have at least a 5-year record of paying dividends. DVY invests its $17.5 billion in total assets in roughly 100 stocks based on dividend yield from a broad market-cap universe.

Unlike many other funds that weigh their holdings according to market cap, DVY weighs its holdings by dividend per share. This results in a skew toward smaller firms that pay consistent dividends.

With its high asset base and great liquidity of $46.15 million in daily trading volume, DVY is one of the most accessible funds on the market for reliable dividend income. Around 30% of the fund’s portfolio is in utilities, which is one of the sectors with the highest yields, although utilities also tend to be rate sensitive and relatively slow-growing.

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