We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Is iShares Emerging Markets Dividend ETF (DVYE) a Strong ETF Right Now?
Read MoreHide Full Article
A smart beta exchange traded fund, the iShares Emerging Markets Dividend ETF (DVYE - Free Report) debuted on 02/23/2012, and offers broad exposure to the Broad Developed Market ETFs category of the market.
What Are Smart Beta ETFs?
Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.
Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
On the other hand, some investors who believe that it is possible to beat the market by superior stock selection opt to invest in another class of funds that track non-cap weighted strategies--popularly known as smart beta.
This kind of index follows this same mindset, as it attempts to pick stocks that have better chances of risk-return performance; non-cap weighted strategies base selection on certain fundamental characteristics, or a mix of such characteristics.
The smart beta space gives investors many different choices, from equal-weighting, one of the simplest strategies, to more complicated ones like fundamental and volatility/momentum based weighting. However, not all of these methodologies have been able to deliver remarkable returns.
Fund Sponsor & Index
The fund is managed by Blackrock. DVYE has been able to amass assets over $634.75 million, making it one of the larger ETFs in the Broad Developed Market ETFs. DVYE seeks to match the performance of the Dow Jones Emerging Markets Select Dividend Index before fees and expenses.
The Dow Jones Emerging Markets Select Dividend Index measures the performance of the companies in emerging market countries that have provided relatively high dividend yields on a consistent basis over time.
Cost & Other Expenses
For ETF investors, expense ratios are an important factor when considering a fund's return; in the long-term, cheaper funds actually have the ability to outperform their more expensive cousins if all other things remain the same.
Annual operating expenses for DVYE are 0.49%, which makes it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 9.86%.
Sector Exposure and Top Holdings
ETFs offer diversified exposure and thus minimize single stock risk, but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
Looking at individual holdings, United Tractors (UNTR) accounts for about 1.81% of total assets, followed by Indo Tambangraya Megah (ITMG) and Companhia De Saneamento De Minas G (CSMG3).
Its top 10 holdings account for approximately 16.38% of DVYE's total assets under management.
Performance and Risk
The ETF has added roughly 7.57% so far this year and is up about 9.77% in the last one year (as of 07/19/2023). In the past 52-week period, it has traded between $22.56 and $26.63.
The fund has a beta of 0.79 and standard deviation of 17.76% for the trailing three-year period, which makes DVYE a medium risk choice in this particular space. With about 159 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares Emerging Markets Dividend ETF is not a suitable option for investors seeking to outperform the Broad Developed Market ETFs segment of the market. Instead, there are other ETFs in the space which investors should consider.
IShares Core MSCI Emerging Markets ETF (IEMG - Free Report) tracks MSCI Emerging Markets Investable Market Index and the Vanguard FTSE Emerging Markets ETF (VWO - Free Report) tracks FTSE Emerging Markets All Cap China A Inclusion Index. IShares Core MSCI Emerging Markets ETF has $73.43 billion in assets, Vanguard FTSE Emerging Markets ETF has $74.76 billion. IEMG has an expense ratio of 0.09% and VWO charges 0.08%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Broad Developed Market ETFs.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Is iShares Emerging Markets Dividend ETF (DVYE) a Strong ETF Right Now?
A smart beta exchange traded fund, the iShares Emerging Markets Dividend ETF (DVYE - Free Report) debuted on 02/23/2012, and offers broad exposure to the Broad Developed Market ETFs category of the market.
What Are Smart Beta ETFs?
Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.
Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
On the other hand, some investors who believe that it is possible to beat the market by superior stock selection opt to invest in another class of funds that track non-cap weighted strategies--popularly known as smart beta.
This kind of index follows this same mindset, as it attempts to pick stocks that have better chances of risk-return performance; non-cap weighted strategies base selection on certain fundamental characteristics, or a mix of such characteristics.
The smart beta space gives investors many different choices, from equal-weighting, one of the simplest strategies, to more complicated ones like fundamental and volatility/momentum based weighting. However, not all of these methodologies have been able to deliver remarkable returns.
Fund Sponsor & Index
The fund is managed by Blackrock. DVYE has been able to amass assets over $634.75 million, making it one of the larger ETFs in the Broad Developed Market ETFs. DVYE seeks to match the performance of the Dow Jones Emerging Markets Select Dividend Index before fees and expenses.
The Dow Jones Emerging Markets Select Dividend Index measures the performance of the companies in emerging market countries that have provided relatively high dividend yields on a consistent basis over time.
Cost & Other Expenses
For ETF investors, expense ratios are an important factor when considering a fund's return; in the long-term, cheaper funds actually have the ability to outperform their more expensive cousins if all other things remain the same.
Annual operating expenses for DVYE are 0.49%, which makes it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 9.86%.
Sector Exposure and Top Holdings
ETFs offer diversified exposure and thus minimize single stock risk, but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
Looking at individual holdings, United Tractors (UNTR) accounts for about 1.81% of total assets, followed by Indo Tambangraya Megah (ITMG) and Companhia De Saneamento De Minas G (CSMG3).
Its top 10 holdings account for approximately 16.38% of DVYE's total assets under management.
Performance and Risk
The ETF has added roughly 7.57% so far this year and is up about 9.77% in the last one year (as of 07/19/2023). In the past 52-week period, it has traded between $22.56 and $26.63.
The fund has a beta of 0.79 and standard deviation of 17.76% for the trailing three-year period, which makes DVYE a medium risk choice in this particular space. With about 159 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares Emerging Markets Dividend ETF is not a suitable option for investors seeking to outperform the Broad Developed Market ETFs segment of the market. Instead, there are other ETFs in the space which investors should consider.
IShares Core MSCI Emerging Markets ETF (IEMG - Free Report) tracks MSCI Emerging Markets Investable Market Index and the Vanguard FTSE Emerging Markets ETF (VWO - Free Report) tracks FTSE Emerging Markets All Cap China A Inclusion Index. IShares Core MSCI Emerging Markets ETF has $73.43 billion in assets, Vanguard FTSE Emerging Markets ETF has $74.76 billion. IEMG has an expense ratio of 0.09% and VWO charges 0.08%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Broad Developed Market ETFs.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.