Analyse: SPDR S&P US Dividend Aristocrats ETF

Dieser Aktien-ETF ist nach der Dividendenrendite gewichtet, begrenzt das Risiko allerdings mit einer breiten Streuung. 

Alastair Kellett 28.09.2012

Rolle im Portfolio

The SPDR S&P US Dividend Aristocrats ETF 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 quite concentrated at the sector level, with 31.4% 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. Indeed, the fund lands in the Core-Value area of the Morningstar Style Box. Since 2000, the S&P High Yield Dividend Aristocrats Index, which is the benchmark for this fund, has experienced annual volatility of 15.4%, a little less than the broader S&P 500. That suggests investors should have a lengthy time horizon in mind when taking on this exposure, so that they can withstand the ups and downs. 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 70%. 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.

Fundamentale Analyse

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 off its highs, is still stubbornly lofty at 8.3%, and a portion of the decline seems due to some workers giving up on the job search and therefore falling out of the official calculation. Moreover, a study by National Employment Law Project found that a large portion of the job gains during the recovery has been in low-paying positions. GDP advanced at an annualised pace of 1.7% in the second quarter of 2012. The housing market has also been in a protracted funk due to an overhang of foreclosures. Historically, spending by the U.S. consumer has been a key driver of growth at home and around the globe, importing a host of finished goods from China and other growing markets. But after the implosion of the residential housing bubble, recession followed by a largely jobless recovery, and reluctance of banks to make loans, the average household doesn’t have the spending clout it once did. That situation, along with increased government austerity, could limit the country’s potential for growth, even as corporate balance sheets and profitability appear healthy. To pick up the stimulus slack, monetary policy has been extremely accommodative. The Federal Reserve has lowered short term interest rates to near zero, and signalled that they will persist at current levels for the foreseeable future. It has embarked on several rounds of quantitative easing, and Chairman Ben Bernanke recently announced another round that will last as long as needed. Despite this, the market does not appear overly worried about inflation, as evidenced by 10-year yields well below 2% and 30-year Treasuries yielding less than 3%. As a result of the even bleaker situation in Europe, the U.S. has maintained its safe haven status among investors, which has enabled the government to continue to borrow on the cheap. Unless Congress intercedes to change the law, a series of major spending cuts and an expiration of Bush-era tax cuts will automatically trigger at the end of 2012, in what has been dubbed the “fiscal cliff.” The Congressional Budget Office predicts that could cause a shrinking of the deficit by $500 billion while leading to real GDP growth of -0.5% in 2013 and pushing the country back into recession. While many investors dream about the thrill of capital gains on the shares they own, through history much of the total return from equities has come in the form of dividends. A policy of paying out earnings on a regular basis 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. The S&P High Yield Dividend Aristocrats Index has vastly outpaced the S&P 500 since 2000, producing a total return of 7.69% per year versus just 0.78% for the broader benchmark, and with less volatility to boot. Further, the Dividend Aristocrats Index suffered less during the financial crisis, registering a loss of 38.2% in the year ending February 2009, against a 43.3% loss for the S&P 500.


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 it 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. 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 September 12th, the top sector exposures were Consumer Staples at 31.4%, Energy at 22.3%, and Health Care at 12.9%.


The fund uses full physical replication to try to capture the performance of its benchmark, 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. It is ISA eligible has UK Reporting status. At the time of writing it had assets of $693 million. Cash received as dividends from the underlying stocks is held by the fund until distributions are made to fund unitholders on a quarterly basis, currently at an annualised yield level of 3.35%. This can create a cash drag on the portfolio, causing it to underperform its benchmark in rising markets, and outperform in declining markets.


The fund’s total expense ratio (TER) is 0.35%, which is middling relative to funds offering similar exposures. Other costs potentially borne by the unitholder but not included in the total expense ratio include bid-ask spreads on the ETF, transaction costs on the infrequent occasions when the underlying holdings change, and brokerage fees when buy and sell orders are placed for ETF shares.


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, Lyxor ETF Russell 1000 Value, and PowerShares FTSE RAFI US 1000 Fund. Of these, the SPDR fund is the largest. The fund with the lowest expense ratio is the iShares product, with a TER of 0.31%.


Über den Autor

Alastair Kellett  Al Kellett is an ETF analyst with Morningstar Europe.