State Street Global Advisors filed regulatory paperwork to bring
to market a fourth dividend ETF, this time truly diving into
"global" markets in a bid to diversify exposure to payout-rich
stocks in an era of ultra-low bond yields.
The SPDR S&P Global Dividend ETF will draw holdings from a
variety of companies in both the developed and developing world in
countries including Australia, Canada, China, France, Germany, Hong
Kong, Italy, Japan, Netherlands, Russia, Singapore, South Africa,
South Korea, Spain, Sweden, Switzerland, the United Kingdom and the
United States, the filing said.
The fund, which will be based on the S&P Global Dividend
Aristocrats Index, will join the SPDR S&P Dividend
(NYSEArca:SDY), the SPDR S&P Emerging Markets Dividend ETF
(NYSEArca:EDIV) and the SPDR S&P International Dividend ETF
(NYSEArca:DWX) on SSgA's ETF platter.
The index, from which the fund will cherry-pick securities using
a representative sampling strategy, is designed to emphasize
stability of dividend payments over higher-yielding securities,
according to Carolyn Hill, an ETF analyst at San Francisco-based
Overall, SSgA's plans fit into a broad trend of the past few
years wherein investors have been gravitating toward globally
diversified, dividend-focused equity funds to avoid the paltry
returns of a bond market which, should ultra-low interest rates
normalize, sell off powerfully.
The fund will comprise its holdings of the top 100 securities
from its index with the highest-paying yields "with no more than 20
stocks selected from each country and 35 stocks in each GICs
sector. To ensure diverse exposure, the weight of each Index
constituent is capped at 3 percent, and no single country or GICS
sector has more than 25 percent weight in the Index," according to
To be included in the index, stocks must, among other things,
have a history of increasing or stable dividends going back at
least 10 consecutive years, with a maximum dividend yield of 10
percent, according to the filing.
The filing didn't specify a ticker or an annual expense ratio
for the proposed fund, but did say it will have its primary listing
on Arca, the New York Stock Exchange's electronic trading
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