Connect with us
Investment expert Jim Woods shares the details on this fund, which focuses on large-cap equities with strong dividend payout and growth.

archive

This Diversified Fund Focuses on Dividends

Investment expert Jim Woods shares the details on this fund, which focuses on large-cap equities with strong dividend payout and growth.

The Fidelity Dividend ETF for Rising Rates (FDRR) tracks an index that reflects the performance of stocks of large and mid-capitalization dividend-paying companies that are expected to grow their payouts and have a positive correlation of returns to increasing 10-year U.S. Treasury yields.

Although an increase in interest rates usually hurts dividend stocks, FDRR??s positive correlation to treasury yields and sector neutrality help protect investors?? returns. In particular, some analysts indicate that FDRR??s exposure to the financial sector reduces the risk associated with rate hikes.

Furthermore, U.S. dividend growth remains impressive even as interest rates are rising. Global consulting market IHS Markit is forecasting that quarterly dividends declared by firms in the S&P 500 will top $115 billion in the current calendar quarter to notch a 2.3% jump from the $112.5 billion declared in Q1.

The fund has a distribution yield of 3.03% and an expense ratio of just 0.29%.

Click here to read the rest of the article, “This Diversified Fund Focuses on Dividends.

Written By

Jim Woods is a freelance financial journalist specializing in the markets and the economy. He champions the cause of liberty from a secured location deep inside the Golden State.

Advertisement
Advertisement

TRENDING NOW:

archive

This Diversified Fund Focuses on Dividends

The Fidelity Dividend ETF for Rising Rates (FDRR) tracks an index that reflects the performance of stocks of large and mid-capitalization dividend-paying companies that are expected to grow their payouts and have a positive correlation of returns to increasing 10-year U.S. Treasury yields.

Although an increase in interest rates usually hurts dividend stocks, FDRR’s positive correlation to treasury yields and sector neutrality help protect investors’ returns. In particular, some analysts indicate that FDRR’s exposure to the financial sector reduces the risk associated with rate hikes.

Furthermore, U.S. dividend growth remains impressive even as interest rates are rising. Global consulting market IHS Markit is forecasting that quarterly dividends declared by firms in the S&P 500 will top $115 billion in the current calendar quarter to notch a 2.3% jump from the $112.5 billion declared in Q1.

The fund has a distribution yield of 3.03% and an expense ratio of just 0.29%.

Click here to read the rest of the article, “This Diversified Fund Focuses on Dividends.

TRENDING NOW:

THE TRUTH ABOUT GLOBAL WARMING: REAL THREAT OR HYSTERIA?

archive

Dystopia Alert: A Decimating National Debt

archive

Guest Columnist: Why We Must Have a Border Wall

archive

Rising Social Agenda Brings Luster to Qualified Dividends

archive

Connect