With more than half of 2023 in the books, advisors may want to take a broader look at their portfolios. What has worked for clients, and what hasn’t? What strategies can slot right into an existing portfolio either as a transitional holding or a long-term play? Advisors looking to refresh their portfolios may want to look to ETFs that work well with others. Pairing a dividend ETF like the ALPS Sector Dividend Dogs ETF (SDOG) with the right growth-oriented strategies presents one notable way to do so.
Dividends slot nicely into existing portfolios for a few reasons. First and foremost, the addition of current income to a portfolio can help when and if the market slips up. It rarely hurts to have some added cover should some strategies in an overall portfolio slow or even see negative returns.
More than that, however, may be the reinvestment potential dividends offer. With each new increment of dividend cash, investors and advisors can reinvest into other ETFs. That allows some inherent flexibility, too, adding to hot strategies without cashing out elsewhere in a portfolio.
See more: “The Bull Case for High Dividend ETFs in SDOG”
What’s more, SDOG itself not only offers dividends; it also offers a multi-cap value approach. While mega-cap tech names have led the markets this year, adding a multi-dimensional value strategy could be prudent. SDOG has outperformed its value category over the last month per VettaFi, returning 4.5%. It has offered a 4% annual dividend yield for a 36 basis point fee, tracking the S-Network Sector Dividend Dogs Index.
Taken together, those points allow SDOG to pair well with varied growth-minded ETFs. The dividend ETF could work well with the SPDR S&P 500 ETF Trust (SPY) or the ALPS Barron’s 400 ETF (BFOR). For investors and advisors looking to freshen up portfolios, a dividend ETF like SDOG could be one to watch.
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vettafi.com is owned by VettaFi LLC (“VettaFi”). VettaFi is the index provider for SDOG, for which it receives an index licensing fee. However, SDOG is not issued, sponsored, endorsed, or sold by VettaFi, and VettaFi has no obligation or liability in connection with the issuance, administration, marketing, or trading of SDOG.
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