High Yield Dividend ETF (HDV) Hits New 52-Week High

For investors seeking momentum, iShares Core High Dividend ETF HDV is probably on their radar now. The fund just hit a 52-week high and is up about 106.7% from its 52-week low price of $40.01/share.

But are more gains in store for this ETF? Let’s take a quick look at the fund and the near-term outlook on it to get a better idea on where it might be headed:

HDV in Focus

HDV offers exposure to U.S. stocks that have historically provided high dividend yields and tracks the Morningstar Dividend Yield Focus Index. It has a tilt toward large-cap stocks with key holdings in energy, consumer staples, health care, information technology and utilities that make up for a double-digit exposure each. The fund is widely diversified across components with each security accounting for less than 6.2% of assets except the top three holdings, which have a combined weight of almost one-fourth of the portfolio. The fund charges investors 12 basis points a year in fees (see: all the Large Cap ETFs here).

Why the Move?

The high dividend corner of the broad investing world has been an area to watch lately given the high levels of market volatility amid low interest rates. This is because dividend-paying securities are the major sources of consistent income for investors when returns from the equity market are at risk. This is especially true as a company that pays dividend generally acts as a hedge against economic uncertainty and provides downside protection by offering outsized payouts or sizable yields on a regular basis.

More Gains Ahead?

It seems that HDV might continue with its strength given a high weighted alpha of 14.40% and moderate 20-day volatility of 13.67%. As a result, there is definitely still some promise for risk-aggressive investors who want to ride on this surging ETF.

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ISHARS-CR HD (HDV): ETF Research Reports

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