As an exchange-traded fund tied to the global agriculture industry, the VanEck Vectors Agribusiness ...
Global Yields and Diverse Dividends
07/14/2015 10:00 am EST
Conventional wisdom explains that it is vitally important to diversify; this is intended to minimize risk from movements or events that disproportionately hurt one type of investment, explains Doug Fabian, fund expert and editor of Successful ETF Investing.
A fund that offers a way to gain the benefits of diversification is Arrow Dow Jones Global Yield ETF (GYLD).
This fund takes a balanced multi-asset approach across five different strategies. Its holdings emphasize dividends and are based on five separate, specific indexes.
It has approximately even holdings in equities, real estate, sovereign debt, corporate debt, and alternative assets, with each subcategory targeted towards dividend-paying investments.
As the fund’s name indicates, it includes positions from around the globe in each of these areas.
The fund pays out an overall yield of 7.91%, compared to an expense ratio of 0.75%, so investors are rewarded nicely for owning it.
Though it has declined by 1.42% this year, when its monthly dividends are accounted for, investors in GYLD have profited in 2015 overall. The following chart shows the fund’s one-year performance.
In terms of individual positions, this fund allocates 8.36% of its assets to its top ten largest positions.
These include Shenzhen Investment Ltd., 1.12%; Ladbrokes PLC, 0.91%; Lewis Group Ltd., 0.87%; LRR Energy LP, 0.84%; and Chesapeake Granite Wash Trust, 0.81%.
In terms of sectors, the fund is most strongly allocated to real estate, financial services, and utilities. GYLD’s portfolio of countries includes the United States, Australia, Singapore, France, and many others.
For investors seeking a simple way to invest in a number of asset classes for a high and diverse yield, Arrow Dow Jones Global Yield ETF could be just what they want.
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