The SPDR S&P Global Dividend ETF (WDIV) was launched on 05/29/2013, and is a smart beta exchange traded fund designed to offer broad exposure to the World ETFs category of the market.
What Are Smart Beta ETFs?
Products that are based on market cap weighted indexes, which are strategies designed to reflect a specific market segment or the market as a whole, have traditionally dominated the ETF industry.
Because market cap weighted indexes provide a low-cost, convenient, and transparent way of replicating market returns, they work well 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.
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.
While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.
Fund Sponsor & Index
The fund is managed by State Street Global Advisors, and has been able to amass over $200.69 million, which makes it one of the average sized ETFs in the World ETFs. WDIV, before fees and expenses, seeks to match the performance of the S&P Global Dividend Aristocrats Index.
The S&P Global Dividend Aristocrats Index measures the performance of high dividend-yield companies included in the S&P Global BMI that have followed a managed-dividends policy of increasing or stable dividends for at least ten consecutive years.
Cost & Other Expenses
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
With one of the cheaper products in the space, this ETF has annual operating expenses of 0.40%.
It's 12-month trailing dividend yield comes in at 4.73%.
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.
When you look at individual holdings, Solvay Sa (SOLB) accounts for about 2.32% of the fund's total assets, followed by Altria Group Inc (MO) and Highwoods Properties Inc (HIW).
WDIV's top 10 holdings account for about 17.53% of its total assets under management.
Performance and Risk
The ETF return is roughly 5.80% so far this year and is up about 10.08% in the last one year (as of 07/29/2024). In the past 52-week period, it has traded between $52.34 and $62.40.
The ETF has a beta of 0.83 and standard deviation of 13.45% for the trailing three-year period, making it a low risk choice in the space. With about 122 holdings, it effectively diversifies company-specific risk.
Alternatives
SPDR S&P Global Dividend ETF is a reasonable option for investors seeking to outperform the World ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
IShares MSCI ACWI ETF (ACWI) tracks MSCI All Country World Index and the Vanguard Total World Stock ETF (VT) tracks FTSE Global All Cap Index. IShares MSCI ACWI ETF has $18.47 billion in assets, Vanguard Total World Stock ETF has $37.69 billion. ACWI has an expense ratio of 0.32% and VT charges 0.07%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the World 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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Get it free >>SPDR S&P Global Dividend ETF (WDIV): ETF Research Reports
Highwoods Properties, Inc. (HIW) : Free Stock Analysis Report
Altria Group, Inc. (MO) : Free Stock Analysis Report
iShares MSCI ACWI ETF (ACWI): ETF Research Reports
Vanguard Total World Stock ETF (VT): ETF Research Reports
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
