For investors seeking momentum, PowerShares S&P 500 High Dividend Portfolio ( SPHD ) is probably on radar now. The fund just hit a 52-week high, and is up about 73% from its 52-week low price of $Array9.83/share.
But are more gains in store for this ETF? Let's take a quick look at the fund and the near-term outlook on it to get a better idea on where it might be headed:
SPHD in Focus
SPHD offers exposure to the U.S. stocks that have historically provided high dividend yields and are known for low volatility. It has a slight tilt toward large-cap stocks with key holdings in financials, utilities, industrials, and consumer discretionary that make up for a double-digit exposure each. The fund is widely diversified across components with each security accounting for less than 3.6% of assets, charging investors 30 basis points a year in fees (see: a all the Large Cap ETFs here ).
Why the Move?
The high dividend corner of the broad investing world has been an area to watch lately given the high levels of market volatility amid low interest rates. This is because dividend-paying securities are the major sources of consistent income for investors when returns from equity market are at risk. This is especially true as a company that pays dividend generally acts as a hedge against economic uncertainty and provides downside protection by offering outsized payouts or sizable yields on a regular basis.
More Gains Ahead?
It seems that SPHD might continue with its strength given a high weighted alpha of 8.Array3% and moderate 20-day volatility of Array7.77% . As a result, there is definitely still some promise for risk-aggressive investors who want to ride on this surging ETF.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.