SPDR S&P US Dividend Aristocrats ETF (EUR) | SPYD |
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Alastair Kellett03/05/2013
Stratégie d’investissement
The fund provides exposure to a subset of the U.S. equity market focusing on companies that have been consistent in paying out dividends to their shareholders. It is fairly concentrated at the sector level, with 17.4% of the total in Consumer Staples stocks, and broadly diversified at the security level, with holdings limited to 4% each. The focus on companies that pay out earnings rather than reinvesting them tends to tilt the index away from growth names. Since 2000, the S&P High Yield Dividend Aristocrats Index, which is the benchmark for this fund, has experienced annual volatility of 15.0%, versus 15.8% for the broader S&P 500. During the same period it has shown a correlation to the S&P 500 of 76%, and to the local-currency returns of the MSCI World Index of 71%. This fund, which pays out quarterly dividends received from its underlying constituents, could be suitable for investors looking for regular income while maintaining exposure to equities.
Analyse fondamentale
While many investors dream about the thrill of capital gains, through history much of the total return from equities has come in the form of dividends. A policy of regularly paying out earnings forces discipline on corporate management, lowering the odds of destructive acquisitions. And dividends give investors a ‘bird in the hand,’ rather than just the promise of enhanced enterprise value at an unidentified point in the future. Amidst an uncertain political and economic backdrop, U.S. companies have vast amounts of cash on their balance sheets and will increasingly be under pressure to do something with it. That may mean handing capital back to investors in the form of higher dividend payments. The S&P High Yield Dividend Aristocrats Index has vastly outpaced the S&P 500 since 2000, returning 8.77% per year versus just 1.79% for the broader benchmark. The Dividend Aristocrats Index also suffered less during the financial crisis, losing 38.2% in the 12 months ending February 2009, against a 43.3% loss for the S&P 500. Because of the bias towards mature companies with more consistent revenue and income, this fund is likely to outperform the broader benchmark in times of market stress, and could be correspondingly expected to underperform in raging bull markets. At the time of writing the S&P High Yield Dividend Aristocrats Index had a dividend yield of 2.95%, versus a yield of 2.15% for the broader S&P 500. Though its fortunes have been overshadowed somewhat by the events unfolding in Europe, the United States has continued to show lacklustre progress towards economic recovery. The unemployment rate, while down from its highs, is still stubbornly lofty at 7.7%. GDP advanced by 2.2% in 2012, up from 1.8% in 2011 but still below the roughly 3% pace it has averaged over the last 30 years. One recent bright spot is that the long-anticipated recovery in U.S. housing seems to be taking hold. The S&P/Case Shiller Home Price Index 20-city composite was up 9.3% for the 12 months through the end of February 2013, although it is still down roughly 30% from its 2006 peak. Thanks to a last-minute deal reached by U.S. politicians, much of the immediate impact of the “fiscal cliff” was avoided, although payroll taxes did rise on December 31st, 2012. Still, the impact appears to have been muted, as consumer spending numbers for January and February were stronger than expected. More recently, spending cuts automatically triggered as part of a sequestration began to take hold in March 2013, and could put a significant dent in this year’s economic output. To pick up the stimulus slack, monetary policy has been extremely accommodative since the global financial crisis. The Federal Reserve has lowered short term interest rates to near zero, and tied its policy objectives to job growth by indicating that rates will remain low until the unemployment rate falls to 6.5%.
Construction de l’indice
The S&P High Yield Dividend Aristocrats Index is weighted by dividend yield, calculated by taking the total dividend payment from the previous 12 months and dividing by the stock price on the calculation date. The weighting of any one stock is capped at 4% at the time of the quarterly rebalancing. The index contains stocks selected from the universe of securities within the S&P 1500, and employs screens to ensure minimum size and trading volume. Rather than focusing only on the highest yielding stocks, the index seeks those with a record of consistency of dividend growth. To be considered for the index, companies must have increased their dividend for at least 20 consecutive years. Whereas previously only the top 60 ranked stocks were included in the index, all qualifying stocks will now be eligible as a result of methodology changes in July 2012. The index currently consists of 84 names. A committee maintains the index, rebalancing quarterly and making changes as needed. If a constituent falls out of line with any of the index’s entrance criteria, the committee can use its discretion to keep it in the index if the change is deemed temporary. This limits portfolio turnover. As of May 2nd, the top sector exposures were Consumer Staples at 17.4%, Financials and Industrials at 15.8% each, and Materials at 11.5%. Top individual positions were Pitney Bowes, AT&T, and AbbVie, with respective weights of 3.0%, 2.7%, and 2.6% at the end of March.
Construction du fonds
The fund uses full physical replication to try to capture the performance of the S&P High Yield Dividend Aristocrats Net Total Return Index, owning – to the extent possible and efficient – shares in all of the underlying constituents in the same weights as those of the index. In certain circumstances it may also use derivatives to achieve its objectives. The fund is Irish-domiciled and has the U.S. dollar as its base currency. At the time of writing it had assets of $1.1 billion. In the 12 months through the end of March, the fund had not participated in the firm’s securities lending programme.
Frais
The fund’s total expense ratio (TER) is 0.35%, which is middling relative to other funds offering exposure to large-cap value stocks in the U.S. Other costs potentially borne by the unitholder but not included in the total expense ratio include transaction costs when the underlying holdings change, and bid-ask spreads and brokerage fees when buy and sell orders are placed for ETF shares.
Alternatives
To get exposure to the U.S. Equity Large Cap Value category, there are a few choices, albeit referencing different underlying indexes. Possible alternatives include iShares DJ US Select Dividend, which gives access to the 100 highest dividend-paying stocks in the Dow Jones U.S. Index, Lyxor ETF Russell 1000 Value, which does not specifically target high dividend payers, and PowerShares FTSE RAFI US 1000 Fund, which uses fundamental indexing. Of these, the SPDR fund is by far the largest. The fund with the lowest expense ratio is the iShares product, with a TER of 0.31%.
