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Is SPDR S&P Emerging Markets Dividend ETF (EDIV) a Strong ETF Right Now?
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Launched on 02/23/2011, the SPDR S&P Emerging Markets Dividend ETF (EDIV - Free Report) is a smart beta exchange traded fund offering broad exposure to the Broad Emerging Market ETFs category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.
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.
Based on specific fundamental characteristics, or a combination of such, these indexes attempt to pick stocks that have a better chance of risk-return performance.
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 sponsored by State Street Global Advisors. It has amassed assets over $472.75 million, making it one of the average sized ETFs in the Broad Emerging Market ETFs. EDIV seeks to match the performance of the S&P Emerging Markets Dividend Opportunities Index before fees and expenses.
The S&P Emerging Markets Dividend Opportunities Index includes 100 tradable, exchange-listed common stocks from emerging market countries that offer high dividend yields.
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.
Operating expenses on an annual basis are 0.49% for this ETF, which makes it on par with most peer products in the space.
The fund has a 12-month trailing dividend yield of 4.28%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
Taking into account individual holdings, Banco Bradesco Adr (BBD - Free Report) accounts for about 3.59% of the fund's total assets, followed by Cia Energetica Minas Ger Prf (CMIG4) and Telkom Indonesia Persero Tbk (TLKM).
The top 10 holdings account for about 25.09% of total assets under management.
Performance and Risk
So far this year, EDIV return is roughly 15.11%, and is up about 27.49% in the last one year (as of 08/28/2024). During this past 52-week period, the fund has traded between $28.75 and $36.80.
EDIV has a beta of 0.68 and standard deviation of 14.36% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 140 holdings, it effectively diversifies company-specific risk.
Alternatives
SPDR S&P Emerging Markets Dividend ETF is a reasonable option for investors seeking to outperform the Broad Emerging Market ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
Vanguard FTSE Emerging Markets ETF (VWO - Free Report) tracks FTSE Emerging Markets All Cap China A Inclusion Index and the iShares Core MSCI Emerging Markets ETF (IEMG - Free Report) tracks MSCI Emerging Markets Investable Market Index. Vanguard FTSE Emerging Markets ETF has $79.26 billion in assets, iShares Core MSCI Emerging Markets ETF has $80.47 billion. VWO has an expense ratio of 0.08% and IEMG charges 0.09%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Broad Emerging 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.
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Is SPDR S&P Emerging Markets Dividend ETF (EDIV) a Strong ETF Right Now?
Launched on 02/23/2011, the SPDR S&P Emerging Markets Dividend ETF (EDIV - Free Report) is a smart beta exchange traded fund offering broad exposure to the Broad Emerging Market ETFs category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.
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.
Based on specific fundamental characteristics, or a combination of such, these indexes attempt to pick stocks that have a better chance of risk-return performance.
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 sponsored by State Street Global Advisors. It has amassed assets over $472.75 million, making it one of the average sized ETFs in the Broad Emerging Market ETFs. EDIV seeks to match the performance of the S&P Emerging Markets Dividend Opportunities Index before fees and expenses.
The S&P Emerging Markets Dividend Opportunities Index includes 100 tradable, exchange-listed common stocks from emerging market countries that offer high dividend yields.
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.
Operating expenses on an annual basis are 0.49% for this ETF, which makes it on par with most peer products in the space.
The fund has a 12-month trailing dividend yield of 4.28%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
Taking into account individual holdings, Banco Bradesco Adr (BBD - Free Report) accounts for about 3.59% of the fund's total assets, followed by Cia Energetica Minas Ger Prf (CMIG4) and Telkom Indonesia Persero Tbk (TLKM).
The top 10 holdings account for about 25.09% of total assets under management.
Performance and Risk
So far this year, EDIV return is roughly 15.11%, and is up about 27.49% in the last one year (as of 08/28/2024). During this past 52-week period, the fund has traded between $28.75 and $36.80.
EDIV has a beta of 0.68 and standard deviation of 14.36% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 140 holdings, it effectively diversifies company-specific risk.
Alternatives
SPDR S&P Emerging Markets Dividend ETF is a reasonable option for investors seeking to outperform the Broad Emerging Market ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
Vanguard FTSE Emerging Markets ETF (VWO - Free Report) tracks FTSE Emerging Markets All Cap China A Inclusion Index and the iShares Core MSCI Emerging Markets ETF (IEMG - Free Report) tracks MSCI Emerging Markets Investable Market Index. Vanguard FTSE Emerging Markets ETF has $79.26 billion in assets, iShares Core MSCI Emerging Markets ETF has $80.47 billion. VWO has an expense ratio of 0.08% and IEMG charges 0.09%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Broad Emerging 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.