Even as a risk-off sentiment emerged in July, interest in U.S. equity ETFs offering attractive dividends surged during the month.
The Invesco Dividend Achievers ETF (PFM) is designed to identify a diversified group of dividend-paying companies. The fund invests in companies that have steady and increasing dividends, according to Invesco.
PFM’s inclusion requirements are particularly tough. The underlying index consists of companies that have increased their annual dividend for ten or more consecutive fiscal years, according to VettaFi.
As such, PFM may be a useful tool for investors looking to construct a long-term portfolio that maximizes the current return generated by the equity component, and may also be appealing to those looking to make a shorter-term tilt towards value stocks.
The fund’s primary screen values consistency as opposed to recent or expected payments. Like many ETFs that focus on dividend-payers, PFM will generally maintain tilts towards certain sectors of the economy, and there is minimal allocation in the fund to mid-cap and small-cap stocks, according to VettaFi.
The top 10 holdings in the fund as of August 9 include Microsoft Corp (MSFT, 4.20%), UnitedHealth Group Inc (UNH, 3.16%), Johnson & Johnson (JNJ, 2.81%), Exxon Mobil Corp (XOM, 2.39%), and Walmart Inc (WMT, 2.22%), Procter & Gamble Co (PG, 2.18%), Visa Inc (V, 2.17%), JPMorgan Chase & Co (JPM, 2.12%), Mastercard Inc (MA, 2.10%), and HD (Home Depot Inc, 1.97%), according to Invesco.
Incepted in 2005, the fund has $708 million in assets under management. PFM charges a 53 basis point expense ratio.
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