About SDY ETF
SDY tracks the S&P High Yield Dividend Aristocrats and only invests in firms that have increased dividends for the past 20 years. The highest yielding firms are then weighted by dividend yield. The portfolio has a lower portfolio yield than the high-yield benchmark and is tilted toward midcaps. The fund holds just over 100 stocks and no single stocks makes up more than 1.9% exposure. SDY includes REITs, contributing to the financial sector allocation.
Who is it for:
Ideal for investors with a longer-term horizon looking for exposure to large-cap value stocks within US equity market.
About the Fund Manager:
State Street was incorporated in 1792, has four decades of experience meeting complex client needs and is the third largest asset manager in the world managing $2.73T. It is the 2nd United States bank on the list of oldest banks in continuous operation. State Street is ranked 14th on the list of largest banks in the United States by assets.
How did we identify this ETF:
A complete pool of 2100+ ETFs are screened on various qualitative and quantitative parameters to evaluate efficiency, tradability and fit. The metrics used were alpha, beta and R-Squared with respect to the segment benchmark and ETF specific metrics such as expense ratio, drawdown, volatility and the overall rating. We evaluate all ETFs and assign a composite score based on our analysis and then select the top ones in a category based on that comprehensive score by the inhouse research / quant analysts team. SDY fee does not have the lowest fee, but excellent liquidity reduces overall costs. The ETF has a large AUM and long track record as well. The strategy is rebalanced on a quarterly basis with the rebalancing mechanism being determined by an algorithm that takes into account the overall performance of the strategy so far.